A 3.2% Cost of Living Adjustment (COLA) on Social Security checks in 2024 would result in an increase of $57.30 on the average monthly benefit of $1,790 that a retiree receives.
The estimate was made by The Senior Citizens League (TSCL), a non-partisan entity that ensures the rights of retirees.
“Although the 3.2% COLA is significantly lower than the 8.7% received in 2023, the highest in more than four decades, is higher than the average of the past 20 years — which was 2.6%. The Social Security Administration is expected to announce the 2024 COLA in mid-October,” TSCL recently explained in a statement on its website.
Historically, TSCL makes its COLA projections several months before the official announcement date in mid October.
Last year, the Social Security Administration (SSA) announced the 8.7% COLA on October 13 that currently applies.
The TSCL had estimated the increase at 3%. The slight increase to 3.2% responds to the increase in the prices of consumer items until August.
SSA needs inflation figures through September to establish COLA amount that will apply next year.
The fit is determined by calculating, comparing and averaging the levels of inflation during July, August and September of the current year with those of the same quarter but last year.
By law, since 1975, that office calculates the COLAs. The change was enacted by legislation that links the measurement to the annual increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
That is, the tool used by the SSA to calculate the COLA is the CPI-W from the Department of Labor’s Bureau of Labor Statistics (BLS).
The adjustment seeks to ensure that recipients of Social Security programs have the purchasing power to deal with the rise in the cost of products due to inflation; or, in other words, that inflation does not decrease the value of Social Security benefits.
Approximately, 70 million people in the US will receive checks starting next January with the new increase.
This group includes Supplemental Security Income (SSI) beneficiaries who will be the first to be paid, according to the delivery schedule used by the agency.
Keep reading:
COLA 2024 on Social Security checks: Why is the Cost of Living Adjustment amount announced in October of each year?
COLA 2024 on Social Security checks: which beneficiaries will be the first to receive payments with the Cost of Living Adjustment?
COLA 2024 on Social Security checks: How could Medicare Part B premiums reduce the monthly amount you will receive?
