Social Security Got Its Biggest COLA Bump Ever – Are Rising Food Prices Covered?
The Social Security Administration announced this week that Social Security and Supplemental Security Income benefits for 2022 will be increased 5.9% to help senior citizens cope with prices that this morning are 5.4% higher than last year.
The Bureau of Labor Statistics released its Consumer Price Index report this morning, showing prices rose in all major categories including all six major grocery store categories and gasoline. Price increases were also seen in utilities and retail.
The price of food, both at home and away, has been of particular concern for those receiving Social Security benefits. The Senior Citizens League, the largest bipartisan league for seniors, has repeatedly called for adjustments to the COLA amount to combat inflation. In 2021, the Cost of Living Adjustment was just 1.3%, making next year’s adjustment an over 4% leap. Originally, the Senior League had originally argued for a 6-6.1% adjustment for 2022, arguing that with prices increasing over 5%, 6-6.1% would be needed to fully cover the needs of senior citizens.
Prices for beef are up a whopping 17.6% over the past 12 months, and all other meat categories like poultry and eggs are up over 10%. Overall, the food at home index is up 4.5% for the year. The Social Security Act ties the annual COLA increase in the Consumer Price Index as determined by the Bureau of Labor Statistics.
The 5.9% COLA will begin with benefits payable to more than 64 million Social Security beneficiaries in January 2022, the SSA said. Increased payments to approximately 8 million SSI beneficiaries will begin on Dec. 30.
Some other adjustments that will go into effect in January of each year are based on the increase in average wages. Based on this increase, the maximum amount of earnings that will be subject to Social Security tax will increase to $147,000 from $142,800.
See: Why Inflation’s 6% Cost-of-Living Increase to Social Security Could Be a Double-Edged Sword
Find: Bringing Home the Bacon Is 28% More Expensive — Unrelenting Inflation Lifts Prices to a 40-Year High
TSCL estimated that a 6% COLA would raise an average monthly benefit of $1,554 by about $93.20 — a huge difference from the $20 per month that the 1.3% COLA raised the same amount just last year.
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