Dear Dr. Per Cap:
When are Social Security payments going up? With soaring prices I could use the extra cash.
Signed,
Fixed Income Frieda
Dear Frieda
Social Security benefits are due for a roughly 9% increase starting in January. This is welcome news for the nearly 70 million Americans who receive Social Security income because they’re retired, disabled, survivors of workers who have passed on, or dependents of beneficiaries.
Next year’s increase will be the largest COLA in forty years. Nope, we’re not talking about super-size soft drinks. COLA stands for cost-of-living adjustment. It’s an automatic benefit increase to offset higher living expenses from inflation. Unfortunately we’re still seeing record high inflation numbers throughout much of the economy impacting everything from food prices, auto insurance, home prices, and rents. Even services like nail salons, barber shops, and repair companies are hiking prices to cover higher labor costs.
We’re definitely going through some tough economic times and hopefully larger Social Security payments will make it easier on a lot of households.
About ten years ago Social Security stopped mailing checks to people. So no more checking the PO box or waiting on the mail carrier. Instead payments go direct deposit into a bank account or on a rechargeable debit card. As an idea of how much extra money to expect, the average monthly Social Security payment for a retiree will go from $1,669 to $1,814. I realize $145 isn’t a Powerball Jackpot but it might help cushion the shock when paying the grocery bill.
Keep an eye out for a COLA notice in the mail during the month of December that will list your new Social Security payment amount. Your COLA notice can also be viewed online if you’ve created a my Social Security account using the Social Security Administration’s official website at ssa.gov
In the meantime keep working that monthly budget to cut costs where you can. Energy prices are closely tied to inflation, especially natural gas which many folks use to heat their homes. So think about weather proofing your home this winter with basic supplies like adhesive backed foam insulation for doors and windows or spray sealant in a can. Maybe lower the thermostat a few degrees too and snuggle up with an extra thick Pendleton blanket, especially on cold nights.
Ask Dr. Per Cap is a program funded by First Nations Development Institute with assistance from the FINRA Investor Education Foundation. For more information, visit www.firstnations.org. To send a question to Dr. Per Cap, email askdrpercap@firstnations.org.