Social Security Benefits Increase for 2014, Is It Enough?
In 2014, social security benefits rose just 1.5 percent, giving people on average an additional $19 a month. This year’s increase is among the smallest since automatic adjustments were adopted in 1975. Since then, annual Social Security raises have averaged about 4 percent, and 2014 marks only the seventh time the annual Cost-of-Living-Adjustment (COLA) has been less than 2 percent. The government’s measure of inflation determines the COLA, which helps those on fixed incomes keep pace with rising prices. Although, many complain the COLA often falls short, especially for people who incur high medical costs.
The COLA affects over a fifth of the nation—including Social Security recipients, disabled veterans, federal retirees and people who receive Supplemental Security Income. Over the past year, medical and housing costs went up nearly 5 percent. Thus, the extra $19 will be quickly consumed by basic needs like food, utilities and health care.
To save money, Congress has considered adopting a new measure of inflation called the chained Consumer Priced Index (CPI). If it were in use today, next year’s COLA would remain at 1.5 percent, and the COLA would continuously be slightly smaller each year. The CPI, in truth, means a benefit cut for millions of current and future retirees, veterans, the disabled and their families.
If you’re experiencing problems with Social Security benefits, contact The Firm at 843-720-2800.