This Year's COLA May Hit Ten Year High
From the
Motley Fool:
... While nothing is set in stone, given that
we don't even have data from the three months that actually count
(July-September), as an early glimpse I'd suggest that there's a good
chance [Social Security's Cost Of Living Adjustment or COLA] could be the biggest raise since 2012, with a slim possibility
of it being the largest raise in a decade. ...
According to the May inflation data release
from the BLS [Bureau of Labor Statistics], which primarily tracks the Consumer Price Index for All
Urban Consumers (CPI-U), the CPI-W has increased exactly 3% on a
trailing-12-month basis. ...
The CPI-U inflation data, which is
similar to the CPI-W, shows that energy has been the primary driver of
higher prices. On an unadjusted 12-month basis, aggregate energy prices
have risen by 11.7% as of May 2018, with gasoline and fuel oil costs up
by 21.8% and 25.3%, respectively. Shelter and transportation services
also saw increases of 3.5% and 3.8%, respectively. Meanwhile, new and
used vehicles are the only line items to have observed year-on-year
deflation over the past 12 months.
With the summer driving season kicking into full swing, and prices at
the pump soaring in the wake of four-year highs for crude oil prices,
energy commodities have a really good shot (at least right now) of
carrying Social Security's 2019 COLA above the 3% mark. Keep in mind
that hurricanes Harvey and Irma, which disrupted production and refining
capacity throughout the Gulf of Mexico and the southeastern U.S. last
year, played a critical role in lifting COLA by 2% for 2018. If this hurricane season is anything like last year's, any extended
disruption in the domestic refining industry could give Social
Security's COLA an outside chance of eclipsing 3.6%, as it did in 2012,
ultimately pushing it to a 10-year high. ...
11 comments:
Thank you Donald Trump, We got nothing from Obama for 8 years.
The COLA was 5.8% in 2009, nine years ago so a 10 year high would have to surpass that.
once again, those living on a "fixed" income, get a bigger raise than those working.
A high COLA results from high inflation - why is that a good thing? People on Social Security are better off if prices drop, since benefits do not drop and so the buying power of their benefits increases (assuming inflation is measured appropriately for them - this is probably not true, but that is an issue for any rate of inflation). Also, no COLA means no increase in Medicare B.
Every cola the last few years has been wiped out by an increase in the amount Medicare takes out. Meanwhile, my rent increases every year, way beyond the $3 cola I got last year. As does my gas, utilities, food, etc, etc. go up. And the $3 this time was more than the zero I've received the last few years.
A high COLA is a good thing for those who have no other income, and a "lower inflation" will not necessarily help. There have been plenty of years, recently, with no COLA but that DOES NOT MEAN inflation was low or non existent. A COLA results if the CPI (Consumer Price Index) is higher during JULY, AUGUST and SEPTEMBER of a given year compared with the previous year. So just those 3 months of higher prices results in a COLA for the next year. If the CPI for those 3 months was the same or lower then no COLA. That, in no way, means that there was not high inflation other months, and considering that most people on SSDI had not planned to be sick, they often do not get to fully realize what their Social Security would be if they retired at the appropriate age.. I had to stop working at 37, if I could have worked until 67 my check would be much greater, and as is prices will continue to rise..I just hope they rise during July-Sept, and stay lower during the rest of the year.
The problem is the COLA is fixed to the wrong index and does not include the areas that the aging and disabled spend the majority of money on.
First, it has nothing to do with Donald Trump or Obama, it is based on a formula in the statute. Those of us getting a government pension get about half of that taken away by the government pension offset provisions. Try living on Social Security without a pension. I doubt most folks could do it!!!
Thanks for higher inflation and lower real wage growth? For less jobs created in Five and a half years? For more debt? Really.
"A high COLA is a good thing for those who have no other income."
No kidding. Just like a raise is good for those who have "no other income." Seriously, just because people work, doesn't mean they have the ability to simply make more money. As noted by @8:24, unless workers get a similar raise, they are actually falling behind those who are not working, in terms of buying power. Costs go up for people that are working too....
Hello 10:00 PM, July 09, 2018,
I meant only 2 things by that:
1) Most people on SSDI have no other income, while some may actually have a pension coming form a past job, a lottery win, or are working part time (allowed under the SGA amount, but i would not advise it as it raises red flags).
2) Yes, people who work DO have the ability to make "more money"
A) you can get a better paying job
B) You can ask for a raise (more for White Collar)
C) You can work a part time job on top of your full time job (I had done that for 6 years, working 7 days a week and during 5 of those I also attended College at night. Of course it was in my younger days, but still there are OPTIONS. I see few, if any options, for me now and YES I do want the CPI to be high JULY-SEPT, and then go down...sorry but that is how I feel and my opinion. The conclusion being people who have medical disabilities are often stuck in a single income and people who are not disabled have many more choices. That is all I meant.
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