The Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W, jumped 0.9% in April and 4.7% from 12 months ago. Importantly for seniors, annual Social Security cost-of-living adjustments, or COLAs, are tied to this figure. The Senior Citizens League estimates a 4.7% COLA for 2022. If that holds, it would be the biggest hike since 2009.
The actual COLA is released in October by the U.S. government.
But while benefits rise with inflation, they don’t keep up with the actual spending of older Americans on goods and services like medical care, argues TSCL, a lobbying group.
To illustrate the damaging effects of inflation on older adults’ buying power — and show Congress why it thinks the COLA calculation should be changed — TSCL this month released its Social Security Loss of Buying Power Study. Social Security benefits have lost 30% of buying power since 2000, the study finds.
COLAs since 2000 have “increased Social Security benefits a total of 55%, yet typical senior expenses through March 2021 grew 101.7%,” according to the study.
The COLA for 2021 of 1.3% was largely wiped out by medical costs: premiums for Medicare Part B, supplemental and drug plans, deductibles and out-of-pocket costs, states TSCL. And that’s not an uncommon occurrence.
As an illustration, the TSCL found the 11 expenses for older Americans that grew the fastest since 2000. We’ve listed them in the gallery above.
(Photos: Adobe Stock, Shutterstock)