The COLA is one of those items that creates discussion throughout the United States. Depending on who you ask the COLA may be enough or not enough each year. What is certain is that in this coming year 2024 the Cost of Living Adjustment does appear to be too short.
Considering how much inflation prices around the world are having, 3.2% doesn’t seem like the best option for raising Social Security checks and wages in the United States by that much. The difference from last year is huge and Americans will feel it starting in January.
Thus, Social Security recipients with a not-too-big benefit could find themselves in very serious financial trouble come January of next year. These benefits could be totally insufficient to pay for all the usual expenses.
Even adding the COLA, these benefits will not be large enough for day-to-day living. Regular living in the United States is not cheap and inflation is only increasing. For that reason, the Cost of Living Adjustment may be too small for next year.
WHY WILL THE COLA 2024 BE TOO SMALL FOR AMERICANS?
The main reason this will happen is because the COLA adjustment is made at only a certain time of the year. If we take into account that to calculate this increase the Government takes the CPI-W for the months of July, August and September, the increase may not be enough.
With that third quarter of the year is not enough to determine the next COLA of 2024. Not only should we keep in mind that from October through January of next year there could be more inflation, but over the next year inflation will continue to increase.
And that’s what primarily makes the COLA unfair, at least to most Americans. Still, the 3.2% figure is set in stone, so all citizens who get such an increase will have to bear all the inflation and increases with just this increase and no chance of getting more.
HOW MUCH WILL SOCIAL SECURITY CHECKS INCREASE WITH THE COST OF LIVING ADJUSTMENT?
Each Social Security check will have a different dollar increase with the COLA 2024. The increase is through a percentage, so not all checks will have an equal dollar number increase. To our current check we must add 3.2% and we will get the final number.
If we have a maximum payment of $4,555 in 2023 as of January 2024 our Social Security will be $4,700. Also, every $1,000 in our check will become $1,032. At the end of the year we will have earned more money, but not enough to keep up with inflation.
Fortunately, some Social Security recipients can claim other benefits such as Supplemental Security Income, which will also see a 3.2% increase. This check will go from a maximum of $914 to $943 starting in January 2024 thanks to the COLA.