Get Ready For A Possible Increase In Social Security Benefits

Matt Lillywhite

Nearly 90% of Americans age 65 and older receive Social Security benefits, according to the Social Security Administration. Also, "among elderly Social Security beneficiaries, 12% of men and 15% of women rely on Social Security for 90% or more of their income."

The cost-of-living adjustment (COLA) is one of the most important announcements each year, as millions of Americans rely on social security benefits to pay rent and buy groceries. And according to the Senior Citizens League, the Cost of Living Adjustment for 2023 will be 8.9%, based on recently released inflation figures.

If the 8.9% estimate proves to be accurate, it would mean the biggest bump in social security benefits for approximately 41 years. And while that initially sounds great, it's important to remember that the cost of living adjustment exists to keep up with inflation. Quoting an article published by Investopedia:

"A cost-of-living adjustment (COLA) is an increase made to Social Security and Supplemental Security Income (SSI) to counteract the effects of rising prices in the economy—called inflation."

The US Department of Labor recently announced that its consumer price index increased by 8.5 percent from a year ago in March, the largest year-over-year increase since 1981. Prices have reportedly risen due to constrained supply chains, strong consumer demand, and global food and energy market disruptions exacerbated by the crisis in Ukraine.

According to The New York Times, "the price pressures have been painful for American households, especially those that have lower incomes and devote a big share of their budgets to necessities." So, millions of Americans across the country would undoubtedly welcome an increase in social security benefits.

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