America’s seniors? You can perform your best Ginger Rogers impression and begin singing “We’re in the Money.” In this economy, the typical senior is enduring challenging times, whether it is surging inflation or a highly infectious respiratory illness. But there is some relief on the way for retirees: Your retirement benefits will receive their most considerable boost since the early 1980s when Ronald Reagan was president and the world started moving on from bellbottom pants. The elderly will be getting more extensive monthly checks.
Drinkin’ Social Security and COLA
The Social Security cost-of-living adjustment, or COLA, will be 5.9% in 2022, the Social Security Administration (SSA) announced on Oct. 13. As a result, the projected average monthly benefit for retired workers will rise from $1,565 to $1,657. An average couple’s benefits would jump by roughly $154 to $2,753 per month. In addition, federal Supplemental Security Income (SSI) benefits for individuals will climb from $794 this year to $841 per month in 2022. For couples, the maximum will be $1,261 next year, up from $1,191.
In 2021, the Social Security COLA was 1.3%. In the last decade, the average COLA had been 1.65%, and in three of the previous 12 years, there was a 0% upward modification to monthly benefits checks.
Sixty-four million Americans will start receiving the revised checks in January, and about eight million SSI beneficiaries will begin getting the additional funds on Dec. 30.
″Today’s announcement of a 5.9% COLA increase, the largest increase in four decades, is crucial for Social Security beneficiaries and their families as they try to keep up with rising costs,” said Jo Ann Jenkins, CEO of AARP, in a statement.
The extra cash results from the U.S. annual inflation topping 5% amid skyrocketing food and energy prices. Still, Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare, noted in a statement that Social Security has failed to keep pace with rising expenses for U.S. seniors for the last 40 years.
Liberty Nation had reported this past summer the likelihood that the Social Security COLA would approach 6% because of soaring inflation. But a key question had also been: Can the SSA afford it?
Send the Bill to the Grandkids?
In September, the Old-Age and Survivors Insurance (OASI) Trust Fund published its annual report, and the Social Security and Medicare Boards of Trustees released their projections. Both programs’ long-term finances have eroded considerably due to the coronavirus pandemic. But while Social Security had been running low on cash before the COVID-19 public health crisis, the retirement scheme has metastasized into social insecurity.
Additionally, politicians’ age-old strategy of kicking the can down the road and relying on future generations to pay for their ineptitude might not work this time. The situation is further complicated because birth rates are falling, and life expectancy is increasing. Moreover, a higher number of people die in America every year than are being born. Yet, so far, nothing is being done to address the serious shortfall.
Over the next 12 months – and potentially heading into 2023 – the SSA will be expanding benefits. One of the measures being employed is to force higher-income workers to pay more toward Social Security benefits. Next year, the maximum amount of earnings subject to the SS tax will jump from 142,800 to $147,000. But, will it be enough, or will the SSA continue to publish bearish projections every year?
Hello, Is This Thing On?
For years, many fiscal conservatives have aired their concerns about the sustainability of Social Security. With the U.S. government $28 trillion in debt and facing $200 trillion in unfunded liabilities and expenditures, it is unclear how Washington will ensure the depression-era retirement program survives. Public policy proposals that would delay its collapse, such as raising the eligibility age and conducting means testing, have been described as political suicide. Evidently, politicians’ priorities are elections and not leaving behind a safe and secure retirement program for future generations. As always, worries about America’s finances have fallen on deaf ears.
~ Read more from Andrew Moran.