Social security: 2023 COLA could be at least 7.6%, surpassing this year’s historic increase

In what could be a sign of that rising inflation may not ease at some point, at least one group has already predicted that the adjustment of the cost of living in 2023 for Social Security the recipients could be as high as 7.6% – a much bigger bump than even this year, which is already the highest in decades.

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The COLA estimate for 2023 comes from the Senior Citizens League, a non-partisan advocacy group. It bases its projection on the latest consumer price index data, CNBC reported.

This year’s COLA is at 5.9%, which is the highest in 40 years. As GOBankingRates has previously reported, the 5.9% increase sums up to an average social security benefit of $ 1,657 in 2022 against $ 1,565 in 2021. If COLA increases by 7.6% next year, the average benefit will increase to around $ 1,783 in 2023

But even that would not be enough to keep up with inflation, which hit 7.9% in February. The inability of annual increases in social security benefits to keep pace with inflation is a common complaint among senior proponents, many of whom say COLA should be based on more than just CPI data.

Mary Johnson, social security and Medicare policy analyst at The Senior Citizens League, told GOBankingRates in December that benefits should be at least partially tied to the percentage increase in Medicare Part B premiums deducted directly from most Social Security pension payments. . These premiums rose to $ 170.10 per month in 2022, an increase of $ 21.60 from last year – an increase of 14.5%.

“There are certainly many others like me who wonder how much higher social security benefits would be if our benefits were tied to the percentage increase in Medicare Part B premiums instead of the consumer price index,” Johnson said at the time.

In any case, the Social Security Administration will not determine the official COLA for 2023 until October, CNBC noted. The final number depends on inflation, which remains a wild card. While inflation has been rising in recent months, the Federal Reserve hopes to tame it through a series of rate hikes in 2022.

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If inflation falls, 2023 will COLA will probably also be lower.

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