This week in the United States came the good news of the increase in Social Security through the COLA. This increase will go into effect next year 2023, but we already know what the final amount of the increase will be. The percentage that the COLA will increase Social Security check amounts is 8.7%. This amount may be very good news, but it also brings concerns to many of the nation’s retirees. Also, it doesn’t matter what state in the United States you live in, as this affects the entire country.
If you’ve already calculated how much you’ll collect with this new increase, you’ll know it’s a good raise. The average benefit will go up $140 a month, which means that from $1,666 it will go to $1806. This nearly $2,000 means a good benefit for any type of retiree, whether they retire at age 62 or age 67. Even so, many of the people who already collect this benefit and know what the increase will be for the following year are worried. It is impossible for everyone to like this decision.
Many Social Security beneficiaries say they need a different increase. The biggest concern of these users is that the 8.7% seems sufficient now, but will not be sufficient next year. This highlights the disapproval of an untimely COLA. Updating the increases should be done, to keep more in line with inflation, on a month-to-month basis. This could be too much work, which is why the government calculates this increase once a year.
An insufficient Social Security increase?
Although the increase is a record one, as it is the largest in 40 years, it seems insufficient. Inflation does not stop even for a moment and every month prices go up and up. That is why millions of American retirees fear they will not have enough money for next year. On top of all this, there are the potential taxes that many of them will have to pay.
With those concerns, retirees in the United States could be in serious trouble. If the prices of everything continue to increase so much, many will not be able to afford regular expenses. That is why it is so important not to rely on Social Security payments alone and to look for other sources of extra income. However, it is good to note that this increase in Social Security through the COLA is great news that retirees will not lose as much purchasing power due to inflation.