October tends to be a month Social Security beneficiaries pay close attention to every month because this is when the announcement comes about what Social Security’s cost-of-living adjustment (COLA) will be for the following year.
Ideally, a beneficiary receives an increase in benefits each year as determined by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which is an inflationary tool that focuses on the expenditures of workers. After looking at projections, it seems likely that this year’s Social Security COLA could be the largest since 2012, according to a recent report from The Motley Fool.
After analyzing inflation data so far this year, if things continue as they have, beneficiaries could see a COLA comparable to the 3.6 percent increase in 2012 or possibly even higher.
Typically people rely on COLA increases to keep up with the rising costs associated with purchasing goods. As The Motley Fool points out, “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 percent mark.”
Social Security beneficiaries have had a rough time of it since 2012, the last year the COLA increase was in excess of 3.5 percent. Last year the COLA increase was just 2 percent and several years it has been less than 2 percent or even no increase at all. This makes getting by extremely difficult if Social Security is your primary source of income as it is for 34 percent of beneficiaries who rely on Social Security for 90 percent or more of their income. The projections made by The Motley Fool are not set in stone, but it is a positive indication of this year’s COLA increase, but we will have to wait until October to be sure.
