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Costs for Retirees Keep Increasing, and Social Security Isn’t Keeping Up
October 7, 2019
When you’re retired, whether you’re relying on Social Security or your own retirement funds, you’re probably living on a fixed income. Unfortunately, the cost of living will continue to rise. Recent data from the Bureau of Labor and Statistics shows what costs are increasing the most. One of the major increases came from health insurance, which shot up 18.6 percent between August 2018 and August 2019. Other major increases were seen in repairs of household items, men’s clothing, car maintenance, and medical care.
The good news for those on Social Security is that there is an annual cost-of-living increase to your benefits. The bad news is that this year’s increase will likely be lower since inflation has been timid. Some advocates argue the cost-of-living increase is pinned to the wrong metric. It is currently based on the CPI-W, which tracks costs for households that have members currently in the workforce. Advocacy group The Senior Citizens League argues that it would be much better to base the cost-of-living increase on the CPI-E, which more accurately tracks the expenses of those over the age of 62. This would allow Social Security benefits to take into account Medicare premiums, one of the largest financial concerns for retirees.
