With the 2024 Social Security cost-of-living adjustment (COLA) poised to fall 5% or more from the 2023 level, it might be a good time to revisit a tweet the Biden administration made late last year bragging about his administration’s role in higher Social Security payments.
As MarketWatch reported at the time, the White House in November issued a tweet saying that seniors “are getting the biggest increase in their Social Security checks in 10 years through President Biden’s leadership.”
The tweet was in reference to an 8.7% COLA approved for 2023 — which was actually the largest in more than 40 years rather than 10 years.
There was one problem, though: No president, including Joe Biden, has any direct say in determining the annual cost-of-living adjustment. It is calculated using a standard formula based on increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
The 2024 COLA will be based on the difference between the average CPI-W during the 2022 third quarter and the 2023 third quarter, according to the Social Security Administration. If there is an increase, it must be rounded to the nearest 10th of a percent. If there is no increase, or if the rounded increase is zero, there is no COLA for the year.
This year’s 8.7% COLA is historically high only because last year’s inflation rate was historically high. Biden played no direct role in determining the COLA, although policies that could have contributed to high inflation might have played a part. If that’s the case, then the administration probably shouldn’t have bragged about it.
Twitter appended a note to the White House post, pointing out that the large benefit increase is an automatic adjustment that’s based on the rate of inflation and required by law, MarketWatch reported.
Meanwhile, critics were quick to jump on the White House tweet, which was later deleted.
In a separate tweet dated Nov. 2, 2022, U.S. Rep. Claudia Tenney (R- N.Y.) said the 2023 COLA “will be one of the largest in decades b/c of Biden’s disastrous policies, which have caused prices to rise, fueled record inflation, & cut it into critical retirement savings.”
As previously reported by GOBankingRates, the 2024 COLA is poised to be much lower than the 2023 COLA — more than 5% lower, according to the latest estimate from The Senior Citizens League, a non-partisan advocacy group. The reason is that inflation this year has slowed considerably from last year.
Following Tuesday’s May 2023 inflation report, the Senior Citizens League now projects that the Social Security 2024 COLA could be 2.7%. That would be the lowest adjustment since 2021, when the COLA was 1.3%, according to the Social Security Administration.
If the inflation rate continues to fall — and the COLA estimate continues to fall along with it — the Biden administration could well boast that its anti-inflation policies contributed to the lower adjustment. The final 2024 COLA determination will be announced in October of this year.
More From GOBankingRates
- 11 Signs You're Struggling Financially -- and 3 Ways To Get Back on Track
- 11 Uncommon Investments That Can Actually Make You A Lot of Money
- 3 Things You Must Do When Your Savings Reach $50,000
- The 4 Fastest Ways To Destroy Your Credit