Most Social Security beneficiaries (58 million) will receive the benefit increase in January. The 8 million Supplemental Security Income recipients will see increased payments as of Dec. 31.
The Social Security Administration (SSA) Tuesday announced a 1.7% cost-of-living benefit increase for 2015.
Most Social Security beneficiaries (58 million) will receive the benefit increase in January, SSA said. The 8 million Supplemental Security Income recipients will see increased payments as of Dec. 31.
Cost of Living Adjustments (COLA) are based on the Consumer Price Index for Urban Wage Earners and Clerical Workers, a measure intended to calculate changes in the buying power of a dollar. This year’s adjustment is low from a historic perspective, although it represents an improvement over 2010 and 2011, when there was no COLA. The average annual adjustment over the previous 10 years was 2.5%.
Jo Ann Jenkins, CEO of AARP, called the adjustment “modest” in a press release, although she said the extra money would be an important weapon against poverty for many retirees facing increased food, utilities, and healthcare costs.
She also took the opportunity to note the political implications of Social Security, particularly with the mid-term elections coming up in a couple of weeks.
“Because most retirees depend upon their earned benefit for at least half of their retirement income, we hope Americans of all political stripes will ask candidates where they stand on Social Security and Medicare,” she said.
Other changes will go into effect based on the increase in annual wages. Starting Jan. 1, the maximum amount of earnings subject to Social Security tax will be $118,500, up from $117,000. That change is expected to affect about 10 million people.