By Elaine Owen, Editor
The Social Security Administration (SSA) just announced a slight rise in monthly benefits for Social Security and Supplemental Security Income (SSI) recipients.
The October 10 announcement of the 1.6 percent hike in benefits is in line with what most Social Security watchers expected.
Social Security Cost-of-Living Raise for 2020 The SSA says the 1.6 percent cost-of-living adjustment (COLA) will begin with benefits payable to Social Security beneficiaries in January 2020.
Increased payments to SSI beneficiaries will start on December 31, 2019.
Social Security COLA for 2020 is muted because of inflation — or the relative lack thereof — in the economy.
COLA is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a broad measure of the price of food, energy, health care, housing, transportation and more.
In years when there is no inflation, there is no increase in benefits. However, benefits are never reduced if there’s no inflation.
This year’s relatively small COLA comes on the heels of what was the largest COLA hike in seven years during the 2019 year.
Historical Cost-of-Living Adjustments
from the SSA
2011 – 0.0%
2012 – 3.6%
2013 – 1.7%
2014 – 1.5%
2015 – 1.7%
2016 – 0.0%
2017 – 0.3%
2018 – 2.0%
2019 – 2.8%
2020 – 1.6%
According to the SSA, the average monthly Social Security check in June 2019 was $1,471 for retirees. That means the 1.6 percent increase next year will translate to roughly an extra $24 in the average check each month.
That’s a slight increase for the 45 percent of single elderly people who depend on that monthly check for 90 percent or more of their income.
Source: Social Security Administration / AP Report