Record Social Security COLA Coming

Of course not. It's welcome non the less.

Inflation is actually higher than is reported. My deductible on my drug plan went up to $40.00 while the monthly premium went down to $4.00. Medicare will go up to possibly $158.00 per month and you can bet the deductible will also rise. Energy bills will rise as well and food is already skyrocketing! I am grateful for the increase, no doubt about it, however, it really will not cover rising expenses.

Whether the SS COLA increase will help that much or keep up with your own inflation needs depends significantly on the amount of your current retirement SS payment. If your payment is average (about $1,550), even a 5.9% increase may not help much, but it’s a lot better than last year’s 1.3%. We scrimped (sacrificed) a lot so I could wait until age 70 to take SS at the highest payment amount for me. Because of that, both of our SS payments currently amount to about $59,000 annually. Adding 5.9% to that will make a pretty good difference - to about 62.5k. I guess my purpose in this post is to encourage folks to wait until 70 to begin SS payments, if possible. And that’s a big IF. Working with a qualified fiduciary financial planner is important as you get ready for retirement and Social Security.

Of course, with two people collecting SS then there is more money in the household. Not everyone has a spouse to help out financially. I am tired of those who love to parade their abundance! I am happy for you however, some of us are single and circumstances may have made it difficult or impossible to wait until 70 to collect our benefits. I am supplementing my SS with a part-time job I love because I am concerned about inflation and if I want anything extra like trips--I may not have the extra money--I did not get a pension and was never offered one my whole career as a nurse. I do have a higher than average SS payment, but still with the increase of 5.9%, while it is nice,it is no real windfall. Medicare premiums and deductibles will likely take a large part of it. This winter energy costs may skyrocket and I doubt even an extra $100.00 a month will go far with inflation as we now have it.

Inflation is far higher than 5.9% and rising! The increase will be eaten up by the increase in my Medicare Supplement. I started taking SS at age 65 after a serous health diagnosis, which made longevity questionable. I would like to see more help for senior citizens that this meager COLA increase. To cover actual inflation, it should be 10%. It is also time for them to stop taxing SS payments! The thresholds were set in 1983 at total combined income(including SS) of 25k. SS payments should be exempt from all taxation! Double taxation is wrong and hurts senior citizens who are really struggling. The year ahead looks really challenging for most seniors, especially single seniors.

The COLA does not rise with inflation -- it rises with an increase in the CPI. Look up the costs that go into the CPI. Most will be amazed that many of the day-to-day expenses we have are not included in the CPI. Some are the biggest hits to our actual cost of living.

Sometimes it’s appropriate to use raw numbers to illustrate a point. In my case they were used to show the impact of delaying the claim for Social Security benefits. I was certainly not intending to show any love for parading our abundance. In fact, our total income is a bit below the US average for couples of our age (Census Bureau 2021) and we have no pensions. My comment was designed primarily for readers of this site who are still in the pre-claiming ages for SS, generally 45-65. I’m fully aware that, for various appropriate reasons, many will not be able to utilize the delaying technique. We have also always given 10% of our gross income (even in the leanest of years), to worthy charities and that has reduced our spendable income annually. Speaking of charitable giving, remember that if you’re 70 1/2 or older and have an IRA (regular or rollover), you can use the Qualified Charitable Deduction (QCD) to make charitable gifts. Using the QCD usually gives you an excellent tax-savings benefit, even if you don’t itemize. Just do an internet search on the QCD and you should find plenty of helpful information.

Nobody is going to get rich from this COLA whether they are a one or two person income family. We all know when we see an increase in COLA, other costs go up so we are lucky to break even in the end. I believe that is what the COLA is meant to do. SS was never meant to be a sole income but a supplement to savings, pensions and other retirement programs. Not everyone has those other things to fall back on.
We need to teach our children from an early age to plan for retirement. Not easy to convince young people to save for a time that is so far into the future. They have other things on their minds like new cars, college debts, marriage, buying homes, kids daycare, divorce. But, it is an important part of life's puzzle. You have found a solution to work part time at a job you love. Some older people can't even work due to illness and not too many companies are looking to hire older people.

No way! Remember that the SS premium that is deducted from your monthly check ALSO increases every time we receive a cost of living increase. Prices on everything have increased with additional increases expected. This is not a short-term problem.

It is projected that the Medicare premium which is deducted from 2022 SS monthly payments will go up $10.00, from $148.50 to $158.50, a percentage increase approximately equal to the 2022 cost of living adjustment increase to monthly SS payments. The official announcement on this will come in the next few days.

Louise, you are so right. Teaching the importance of not relying on SS for any young people is really critical. I was taken under the arm of a manager when I was just 25 and he said I should forego new clothes, a new car and first cover my 401K to the max possible. I did just that for the remainder of my working life. I tell my young family members the same thing. I'm now 66 working part time using investments to get me to 70 for SS. I know everyone has different life circumstances though with too many bumps in the road...I'm just using as a general comment. They need robust financial training in high school as it is complicated!

Can you imagine how far reaching simple good course on financial responsibility and retirement planning for middle and high schoolers would be? Kids very often learn things from teachers that they ignore from parents.

Social Security COLA’s have not kept pace with inflation and Medicare payments. The way the rules punish women for the years they stay out of the paid workforce, have had a very negative effect on women. I guess the important lesson for our daughters and granddaughters is not to stay home with children and to put their careers first, because things happen in life and planning for their own future is more important than anything else. Let’s hope the BBB plan passes so women can get the low cost day care that will be needed so out daughters can plan for their own futures. Looks like instead of changing the SS rules to give women credit, Americans have decided day care from birth is best for children.