According to the Bureau of Labor Statistics, the expected COLA boost for 2023 Social Security benefits should be close to 8.7%.
This prediction was also made by the Senior Citizens League after analyzing the rate of inflation for the last few months. Using the CPI, the new COLA increase is determined by raising benefits enough to hopefully offset inflation next year.
COLA increases happen for those receiving Social Security payments living on a fixed income. Due to the income not changing throughout the year, the boost is to help make life more affordable by keeping up with inflation.
COLA 2023
The COLA adjustment for 2023 is set to be announced by the Social Security Administration next month in October. Last October the COLA increase was announced to be 5.9%, one of the largest in years. This year, the estimate is much higher. This will increase monthly Social Security checks by a noticeable amount.
Sometimes there are no increases, or very small increases that happen after the inflation rate stays low or the same all year. The COLA change will never go down, it will always stay the same or rise. If the boost is over the 8% currently being projected, it will be the largest in 40 years.
Seniors have found themselves struggling to afford medications, food, and utilities this year. Many have cut dosages in half or are only eating one meal per day now. While the 5.9% increase was supposed to be helpful in 2022, it was based on 2021 numbers.
Until inflation data for the month of September is released, the exact amount benefits will increase will not be known. The increase is based on inflation rates for July, August, and September and are announced in October every year.
Should the boost be around 8.7% like different entities are predicting, it would be an average boost of about $144 per check. Typical increases are usually around 1%-3%, according to Marca.
This would be the single largest increase since the year 1981 when Americans saw a boost of 8.7%. Seniors already receiving benefits, as well as those with disability or SSI, do not need to do anything. The change will happen effective Jan. 1, 2023 so no application is necessary.
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Samantha edits our personal finance and consumer news section. Have a question or lead? Send it to [email protected].