Robert Rolfe is a Financial Advisor at Harmony Financial Services (HFS). Securities and Advisory Services offered through SagePoint Financial (SPF). SPF and HFS are separately owned. www.harmonyfinancialservices.com.
The news keeps getting better for Social Security recipients.
It’s now projected that benefits will increase 6.1 percent in 2022, up from the 4.7 percent forecast just two months ago. That would be the most significant increase since 1983.
It’s all about inflation. Social Security cost of living adjustments (COLA) are based on the consumer price index, which rose 5.4 percent in June — its largest 12-month increase since 2008. The official announcement is expected in October and, once it’s confirmed, the revised payment will go into effect in January 2022.
More than 65 million Americans receive Social Security, and the annual cost of living adjustments are designed to help recipients manage higher costs. At the start of 2021, recipients saw a 1.3 percent increase.
The average monthly benefit is $1,544 for retired workers. So a 6.1 percent increase amounts to $94 more a month. That might not be quite enough for a car payment, but it’s double the 3 percent raise being given to U.S. workers in 2021.
Social Security can be confusing. One survey found only 6 percent of Americans know all the factors that determine the maximum benefits someone can receive.
If you have any questions, please reach out. We have a number of resources at our fingertips that you may find helpful.