Social Security has announced the highest increase in payments since 1982. Social Security will be sending notices of a 5.9% increase. In comparison, last year's increase was 1.3%.
We have all seen higher prices just about everywhere. This inflation now means that the cost of
living needs to be adjusted. The purpose of COLA (Cost Of Living Adjustment) is to make sure
inflation doesn’t erode your Social Security benefits. Mostly, it has been the increase of energy
prices that has brought this inflation. A gallon of unleaded gasoline costs an average of $3.18, up
from $2.19 a year earlier. The price of hotel rooms has risen 19.6 percent in the past 12 months.
Used car prices have jumped 31.9 percent because the supply of new cars fell sharply. It is
expected that the inflation rate will decline to about 2 percent in 2022 if the production lines
catchup.
The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor’s Bureau of Labor Statistics measured “in a market basket of goods and services, including food, energy and medical care”.
Congress enacted the COLA provision as part of the 1972 Social Security Amendments, and automatic annual COLAs began in 1975. Before that, benefits were increased only when Congress enacted special legislation.
The average monthly benefit for retired workers, currently $1,565, is scheduled to increase to
$1,657 in 2022. For people receiving Social Security Income (SSI), their monthly benefits of
$794 will increase to $821.
It is expected that Medicare Part B will increase approximately $10 per month, raising the
monthly rate to $158.50 for 2022 from $148.50
If you are among the 70 million of Americans receiving Social Security benefits, you can expect to be notified about your new benefit amount by mail starting in early December. You can also see your benefits status and more online. Just click here to view or create your Social Security account.
