There's been a lot of talk about the price of things going up, and we are all seeing it. Well, there is a silver lining for retirees.
It's now projected that benefits will increase 6.1% in 2022, up from the 4.7% forecast just two months ago. That would be the most significant increase since 1983.1,2
It’s all about inflation. Social Security cost of living adjustments (COLA) are based on the consumer price index, which rose 5.4% in June — its largest 12-month increase since 2008. The official announcement is expected in October and, once it’s confirmed, the revised payment will go into effect in January 2022.3
The average monthly benefit is $1,544 for retired workers. So a 6.1% increase amounts to $94 more a month. That might not be quite enough for a car payment, but it’s double the 3% average raise being given to U.S. workers in 2021. Makes "being on a fixed income" seem not so bad after all!
Inflation has been all but dormant for the past 20 years or more, so retirees have gotten accustomed to very meager COLAs in their checks. So even though it is illusory (likely absorbed by your increasing cost of living) a pay raise still feels good.
Not retired yet? Well, maybe you can use this with your boss when arguing for a raise!
Social Security can be confusing. One survey found only 6% of Americans know all the factors that determine the maximum benefits someone can receive. If you have any questions, please reach out. We have a number of resources at our fingertips that you may find helpful.6
1. Fortune.com, July 15, 2021
The forecasts for Social Security benefits are based on assumptions, subject to revision without notice, and may not materialize.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite, LLC, is not affiliated with the named representative, broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security.
A 6.1% Bump in Social Security?
July 21, 2021