Social Security Benefits Could Get Their Biggest Boost in 40 Years.

11522914 said:
For some reason I can't seem to grasp this. For example:

Person A - On Oct 1st has $100 they normally spend on groceries. On Oct 31 Person A bought brand name products and they had to spend $110. Person A has 10% inflation. The next 30 days Person A had to spend $112 so inflation over 2 months is now 12%.

Person B - On Oct 1st has $100 to spend on groceries. Person B buys the exact same items as Person A but decides to wait for sales, finds coupons to purchase their items. On Oct 31 Person B spent $90, therefore reducing their costs by $10. The next 30 days Person B had to spend after sales and coupons $93 so inflation did impact them.

It seems that Person B was able to reduce their personal inflation rate by using strategies Person A doesn't care about. How is that not reducing their personal inflation rate when they both end up purchasing the same exact products?
Click to expand...

Example absurdum:
If person B decided to not eat for the next 30 days, would they be experiencing price deflation?

No, they have changed their spending in RESPONSE to inflation.
 
copyright1997reloaded said:
Example absurdum:

If person B decided to not eat for the next 30 days, would they be experiencing price deflation?



No, they have changed their spending in RESPONSE to inflation.
Click to expand...
Got it. At least Person B has $19 more $ to do whatever with and didn't sacrifice any change in product selection but it did take some effort.
 
Chuckanut said:
According to one inflation calculator what cost $1 in 1973 cost $2.05 by the end of 1981. The value of the dollar cut in half in nine years. :eek:
Click to expand...

Yeah and in 1982 they said a million dollars aint what it used to be. 40 years later a million dollars is worth even less, but the vast majority still don't have it. Think I'll take my million and live with the inflation. I won't get on TV with Robin Leach due to inflation, but I can still take care of my family. Unemployment has always been much more stressful for me than inflation, x4 when healthcare was totally tied to your job.
 
DJRR said:
Yeah and in 1982 they said a million dollars aint what it used to be. 40 years later a million dollars is worth even less, but the vast majority still don't have it. Think I'll take my million and live with the inflation. I won't get on TV with Robin Leach due to inflation, but I can still take care of my family. Unemployment has always been much more stressful for me than inflation, x4 when healthcare was totally tied to your job.
Click to expand...

Is Robin Leach even still around??
 
Gumby said:
The social security COLA does not cause inflation, it is the result of inflation. I agree with you that we don't want to have entrenched high inflation because it is bad for society, but we can't change what has happened over the past year, and I'd like at least some chance to stay even. So I will take my raise with a clear conscience.



I've seen your co-worker's thought process before -- "I don't want to earn more money, because I'll just pay more taxes" - and I find it baffling. Unless the marginal tax rate exceeds 100%, more money is always better. I will concede that there are certain income "cliffs" in the tax code where the marginal rate could exceed 100% over a small range (IRMAA, ACA), but that is rare. Now, on the job, one could reasonably conclude that the marginal value of extra income is not worth the extra time needed to earn it, but that's a different issue.
Click to expand...

I must be rare. I'm literally $1 over the IRMAA cliff into 2nd tier payments for Part B. $1 freaking dollar in AGI two years ago on my tax return. Could be wrong, off the top of my head, but I think the figure was $90,001 in AGI.
 
And here it is shown graphically:
 

Attachments

  • Screen Shot 2022-10-13 at 8.48.49 AM.jpg
    Screen Shot 2022-10-13 at 8.48.49 AM.jpg
    182.4 KB · Views: 106
8.7%, Wahoo!!! :D :dance: :clap:

(Yeah, I slept late! But what a nice bit of info to wake up to. :D)
 
The news I read about the 8.7% increase said, "The adjustment represents the largest one-time increase since 1981, and the largest experienced by beneficiaries alive today."

So, I was wondering, just how does this compare to 1981? In 1981, the increase was 11.2%. Hmmm, todays increase is about 78% of that in 1981. That gives us some reference.
 
A consolation prize for those turning 62 in 2023 and missed out on this COLA, the AWI for 2021 has been published at $60,575, increase of 8.89% over 2020, which is 3% better than estimates. To be honest, I'm not sure how much that plays in to benefits, but I know it counts for something.

https://www.ssa.gov/oact/cola/AWI.html
 
I wonder what this will do to the SS Longevity rate. 2034 was the last one I saw before it became insolvent, or whatever was speculated to happen to SS in 2034.
 
And in addition to the lovely COLA for 2023 my account has just been adjusted for my 2021 earnings. This little bump up usually shows up in March so I've been checking to see if it had posted. Finally showed up today - a $3.60 a month increase (0.457%) because in 2021 I made $4,700 from my very part time job. And I got a lump sum payment for 9 months for the missed increase for Jan - Sept 2022. Nice!

So the calculations I made for the 2023 COLA all had to be redone to reflect my new SS benefit amount.

SO MUCH FUN!
 
Last edited:
Question - Does this matter to me? If so, when will it matter.

I’m 61. I filed and received (got accepted for) disability. I will receive my PIA (full retirement benefit amount) and the first payment is scheduled to come in January 2023. Per the letter, that amount is supposed to be about $3K. Will the recently promulgated increase be added to that first payment? Or, will I get the scheduled payment until some other time, like the next update.
 
You must log in or register to reply here.

Similar threads

G
Social Security Max monthly benefit
2
Replies
39
Views
4K
samcat
S
M
Our First Year of Retirement!
2
Replies
44
Views
3K
Time2
T
D
I am 61 years old: Will my Social Security benefits reflect the 8.7% increase?
2
Replies
34
Views
7K
Out of Steam
Out of Steam
Graybeard
Inflation could prompt largest Social Security cost-of-living adjustment in decades.
3 4 5
Replies
116
Views
17K
jollystomper
jollystomper
A
Mission 1/1/22: Please Pressure Test Our Plan!
Replies
14
Views
2K
Retch The Grate
Retch The Grate

Latest posts

Back
Top Bottom