The nation’s 69 million Social Security beneficiaries will see a slight bump in their checks next year — but not as much as retirees saw in 2019.
#BREAKING! Nearly 69 million Americans will get a 1.6% increase in monthly #SocialSecurity and #SSI benefits in 2020. Check #SocialSecurityMatters later this morning for more information: https://t.co/BDNvNs2Opi #COLA #2020COLA— Social Security (@SocialSecurity) October 10, 2019
Next year’s 1.6 percent boost will raise the average retiree benefit to about $1,503 per month, according to Mary Johnson, a Social Security policy analyst at the Senior Citizens League.
Social Security cost-of-living adjustments have averaged 1.4 percent over the past decade. Retirees and other beneficiaries saw no increase in 2010, 2011 and 2016. The Social Security Administration calculates the percent changes using the consumer price index for urban wage earners and clerical workers (CPI-W) from the Bureau of Labor Statistics.
Cost-of-living adjustments, which were implemented more than 40 years ago, are meant to counteract the effects of inflation, but economists are concerned that costs are rising at a much faster rate than the purchasing power of Social Security benefits.
For example, research by the Senior Citizens League showed that from January 2000 to January 2019, cost-of-living adjustments increased Social Security benefits by roughly 50 percent; however, costs and services frequently incurred by Social Security beneficiaries climbed more than 100 percent during the same period. Prescription drugs and fresh groceries, for example, have become far more expensive.
Furthermore, a study by the Senior Citizens League found that Social Security benefits have lost one-third of their buying power since 2000.
“When a retiree’s actual costs climb faster than their [cost-of-living adjustment], the buying power of Social Security erodes,” the Senior Citizens League wrote in September.