Social Security: COLA Payments Maybe Reduced In 2024

social security

Recent figures indicate a decline in inflation. Currently, the Senior Citizens League predicts a 2.7% increase. 

The official inflation rate has fallen from an alarming 8.6% in May 2022 to a more manageable 6.4% in January to 4% in May, and estimates for the cost of living rise for Social Security have followed suit. In April, Social Security Administration officials forecasted a 3.3% increase for 2024. 

In May, the Senior Citizens League predicted it to be 3.1%; as of the present, it is 2.7%. It won’t be obvious until far into the following year whether retirees will receive an increase that accurately represents their purchasing power due to how the raise is calculated. 

Social Security Payments Will Take Another Hit 

According to the League, “that gap theoretically ought to produce a modest temporary boost to purchasing power of around $52 per month for a retired person with average retirement benefits of $1,694.” The league recognized in its statement that this happened after several years in which the adjustment lagged behind inflation. 

Compared to the 6.5% final annual inflation rate, the 2022 Social Security adjustment of 8.7% was much greater. In the foreseeable future, it is anticipated that the US economy would grow steadily. The financial situation of Social Security and Medicare is still precarious. One of the most important safety-net initiatives in America is one of these two programs. This underscores the pressure Washington legislators and the Biden administration face as they work to protect the ongoing benefits for the tens of thousands of retirees whose numbers are on the rise every year. 

The reports that the US government has submitted are not acceptable to the program trustees. It illustrates how severe deficits for both Social Security and Medicare pose a long-term concern. This will result in lower retirement benefits. Seniors must regularly monitor rising costs, particularly those for food and housing, to guarantee their sustainability.