Inflation has reached unprecedented heights in 2022 as a result of the COVID-19 pandemic’s aftereffects, supply-chain problems, and the effects of Russia’s incursion of Ukraine. The present rate of inflation is 8.5 percent despite the Federal Reserve of the United States raising interest rates.
With an anticipated additional increase in 2023, the cost-of-living adjustments, or COLA, for this year for Social Security was at 5.9 percent, or a 93-dollar increase from 2021. The Consumer Price Index has already increased by 9.1 percent from a year ago, according to data from the US Bureau of Labor Statistics. While inflation has slowed recently, it has continued to rise for 18 straight months despite the Federal Reserve’s 2 percent objective being exceeded.
What will the Social Security benefits increase be in 2023?
The Social Security Administration will release the precise figure in October of this year after considering the current COLA-affecting circumstances. The precise increase will depend on several factors, with experts and analysts suggesting that it might range from 8.7 to as much as 11.4 percent.
The director of the Urban Institute’s retirement policy program, Richard Johnson claimed that a 9 percent estimate would be a credible one. Johnson told the AARP, “I think something in the 9pc band is a reasonable estimation.”
“Energy prices, in particular, are difficult to forecast with any degree of certainty over the upcoming few months. That, in my opinion, is the main area of ambiguity.” Social Security payouts would rise by $150 per month or $800 per year with a 9 percent increase.
What time will be chosen as the final number?
The exact figure will be determined by the Bureau of Labor Statistics sometime in October, and Social Security recipients will receive checks reflecting the new amount in January. The new amount will be factored into beneficiaries’ benefits in Dec 2022, the month in which the most recent COLA takes effect reports Marca.
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