The costs of everyday items are rising faster than Social Security can keep up. This harsh reality is impacting many senior citizens who rely on fixed monthly payments.
Diving Deeper
Unfortunately, the mechanism that’s supposed to help Social Security benefits keep up with inflating costs is not doing its job.
The annual cost-of-living adjustment (COLA) uses the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for calculations. But this index does not truly reflect the spending habits of senior citizens, nor does it account for the increasing costs of healthcare.
To help with this, a bill had previously been proposed to change the index used. Rather than relying on the CPI-W for COLA calculations, the bill proposed using the Consumer Price Index for the Elderly (CPI-E). This index would more accurately reflect the spending patterns of senior citizens and retirees.
Sadly, even if this change occurred, it would not be enough.
Buying Power Decreasing Rapidly
The Motley Fool reports the prices of goods and services to be increasing faster than Social Security benefits.
Because of this, Social Security beneficiaries are seeing their benefit payments lose their buying power. In fact, Social Security benefits have seen a 40 percent decrease in buying power in the past 22 years alone.
The fact is benefits are not keeping up with the rising costs of inflation; this means that retirees dependent on Social Security are struggling to have a comfortable life during retirement.
We Have a Solution
Even though things seem dire, we have a solution. Our groundbreaking bill, The Senior Citizen’s Bill of Rights, provides retirees with seven essential rights to guarantee a more financially secure retirement.
Among these rights is the demand for COLA calculations to factor in healthcare costs. With this addition, retirees can rest assured that their health will be taken care of without detracting from their overall financial security.
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