Throughout the year, it’s been expected that due to present inflation, the cost-of-living adjustment (COLA) for Social Security recipients would go up by a huge amount in 2022. Some have predicted that the adjustment could go up by as much as 6 percent.
Now, the number is out, and while it’s below 6 percent, it’s still the highest COLA raise since the early 1980s.
“The 5.9 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 64 million Social Security beneficiaries in January 2022,” SSA said. “Increased payments to approximately 8 million SSI beneficiaries will begin on December 30, 2021.”
The SSA also said that “the maximum amount of earnings subject to the Social Security tax” will rise from the current level of $142,800 to $147,000.
According to the AP, the adjustment will mean an additional $92 a month for the average retired worker. The average benefit per month will rise to $1,657 a month for individuals and $2,753 a month for couples.
The Senior Citizens League, which had been issuing projections about the COLA figure throughout the year, issuing a statement welcoming the announcement but expressing some concern.
“Over the past 21 years, COLAs have raised Social Security benefits by 55 percent but housing costs rose nearly 118 percent and healthcare costs rose 145 percent over the same period,” Mary Johnson, Social Security and Medicare policy analyst for The Senior Citizens League, said in a statement by the group.
The Senior Citizens League noted that the COLA increases in most recent years have been in the low single-digit percentages, including 1.3 percent in 2021.
“COLAs are intended to protect the buying power of Social Security benefits but, according to consumer price data through July of 2021, Social Security benefits have lost nearly one-third of their buying power, 32 percent, since 2000, about the length of a typical retirement,” Johnson added.
The League had called, earlier this fall, for an additional round of $1,400 stimulus checks for Social Security recipients, to help them better deal with inflation. It doesn’t appear, however, that that proposal has gained any traction in Congress, which is currently debating President Biden’s reconciliation package, which does not include stimulus checks.
“Social Security benefits are one of the few types of income in retirement adjusted for inflation. But soaring inflation has taken a toll on household finances of retired and disabled Social Security recipients,” the League said in a petition this fall. “In 2021 Social Security benefits increased by just 1.3 percent raising the average benefit by only about $20 a month. But about 86 percent of Social Security recipients surveyed say their expenses increased by much more than that amount.”
Stephen Silver is a journalist, essayist, and film critic, who is also a contributor to The Philadelphia Inquirer, Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review, and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.