There Will Be No Social Security Cost of Living Adjustment in 2010
What Does This Mean to Americans?
What is the CPI? The consumer price index has been used since World War I as a measure of the price level of consumer goods and services. It is calculated by observations made in the price changes of a vast array of products in urban areas weighed against the share of income consumers spend on purchases. Major expenditures calculated in measuring the CPI are food prices, housing, transportation, medical care, apparel, recreation, education, and other goods and services.
The CPI is the major tool used by lawmakers in measuring inflation. Some critics charge that because of the way the CPI is calculated, and because of the fact that energy and food price changes are currently excluded from the calculation for "core inflation" that inflation is being dramatically underestimated.
The major reason that the cost of living has been determined to go down is because of the plummeting oil prices compared to those of last year. Everyone remembers when in 2008 gas prices soared to well over $4 a gallon. Falling home prices and low mortgage rates have also had a factor in determining the CPI.
Regardless of the cause, Social Security recipients are going to be hard hit this January. About 1 in 4 medicare recipients will see an increase in their Medicare premiums. AARP estimates the number at 11 million Americans.
I doubt that many Social Security recipients, especially senior citizens (who will be hardest hit) feel that their cost of living has decreased over the last year. Medicare premiums are going up. Food costs were reported to have decreased by 0.1%; however, core inflation rose by 1.5% meaning your dollar buys less. The rise in inflation has offset any modest saving on food and energy.
Many Americans are questioning how we can afford as a country to bail out such financial giants as AIG and the US auto companies and not give our own citizens, the Social Security recipients (often the neediest among the citizenry) a modest cost of living allowance?
Sources:
http://www.fedsmith.com/article/2051/your-2010-pay-raise-2-29-34.html
http://en.wikipedia.org/wiki/United_States_Consumer_Price_Index
http://www.usatoday.com/money/economy/2009-10-15-social-security_N.htm
http://www.ssa.gov/pressoffice/colafacts.htm
Published by Janet Hunt - Featured Contributor in Business & Finance
Janet Hunt is a freelance writing professional specializing in business and finance. She has published articles for such online publication sites as Demand Studios, Associated Content, and various other onli... View profile
- A Unique Way of Looking at Social SecuritySocial Security is frequently thought of in terms of a monthly retirement check, but there is much more to the program than meets the eye.
- Social Security Tax and BenefitsEven though private social security will cost too much to maintain, it should be made private because you control and own the private account resulting in higher returns at retirement.
- American Seniors Have Lost 40% of Buying Power in 7 Years, Study SaysThe cost of living for American seniors has far outstripped their incomes, with some key expenses increasing three times as fast as the average senior's monthly income.
- Consumer Price Index (CPI)The CPI is more important to consumers than the GDP index because the GDP index uses indicators not as important to consumers such as government purchases, foreign trade and capital goods.
Social Security Increase Catches Up with Cost of Living Increase; Really?A social security increase for 2009 will leave social security recipients seeing 5.8% more money. This step is slated to affect about 50 million people and result in an actual f...
- Social Security Benefits Set to Increase
- 8 Ways to Save Social Security
- Social Security Increase for 2009 'COLA', SSDI and Medicare Premiums
- Social Security Tips for Retirees
- Punishng Social Security Recipients
- What is the Consumer Price Index?
- The Medicare Factor in Long Term Care Planning
33 Comments
Post a CommentCOLA (Cost Of Living Adjustment) Is Nada
Does this refer to an ice cold red, white & blue can? Nope!
How about Bill Cosby’s favorite soft drink, good old Coke?
Neither, as COLA refers to something dealing with money,
By no means is it sweet & delicious as queen bee’s honey.
Cost Of Living Adjustments was adopted by U.S. Congress,
In 1970, setting the standard so no one would have to guess,
Where consumer prices are lower than they were 2 years ago,
So a fruitful sip of much needed COLA, Uncle Sam says No.
Almost 59 million retired and disabled Americans are to do,
Minus an increase unless the SSA pushes for something new,
Like a one time $250.00 payment to recipients, wow big deal,
Representatives can spend more than that on an evening meal.
It will face opposition from the Senate if passed by the House,
While many senior citizens munch on trash left by the mouse,
All of the best garbage has already been consumed by the rat,
Every rodent in New York City
this is very sad news for the millons of people on social secrity and disibility benefits.every time i go to get food at the grocery store,it makes me sick to find out every thing is so damm high, with what i get a mounth it's getting very hard to survive.....sad sad sad!!!!!!!!!!!!
Cost of living going down? Decision makers haven't been to a grocery store, heated their homes or paid their own insurance premiums. I don't know what they are smoking but let's hope they share for free. It won't help the economy but it might help us forget about it. :o)
You make some excellent points.
I will begin collecting Social Security in 2010. I'm not interested in the politics of it all, but I do realize food & fuel are higher, and not lower. One evidence of greedy commerce is that when fuel goes up - food goes up - and when fuel goes down - food does NOT go down. That despite the fact that the grocery stores make the lion's share of the profit (for no good reason) and the farmers' pay probably DOES go down when fuel goes down.
So much is changing...
We sure live in a crazy time financially, don't we?
What it means to this American is that for 50-years they've taken my money and now that I'm being laid off, SS may fold! Excellent reporting on a tough subject.
No money to pay retirees more, because SSA is bankrupt or something along that line is what they all keep saying, and yet I read not long that they are paying for something (I can't remember what program it is.) out of the SSA funds. I do remember that it is something that the democrats were coming up with for Congress. That just don't sound quite right to me. Great piece of writing Janet!
Johnny Yuma
Terrific reporting!