Each year, Social Security adjusts your monthly benefits in accordance to inflation projections and rising prices for the coming year. Today, the Social Security Administration officially announced what the cost of living adjustment will be for 2015. As predicted, Social Security recipients will receive an increase by 1.7 percent for the year 2015, starting December 31, 2014.
In order to keep up with our ever-changing, ever-inflating economy, the Bureau of Labor Statistics calculates the Consumer Price Index for Urban Wage Earners and Clerical Workers (or CPI-W) based on consumer prices from July-September of the previous year. This means that in 2014, average consumer prices are 1.7% higher than they were in 2013.
Compared to the 1.5% cost-of-living adjustment for 2014, the COLA for 2015 is a meager 0.2% increase, equating for some to only an extra $20 per month. For the first 35 years of the SSA’s cost-of-living adjustments have only dipped below 2% seven times, leading to disappointment for many. Although the increase isn’t what many hoped for, take comfort in the fact that it’s an increase, not a decrease. In the words of the American author Elbert Hubbard, “positive anything is better than negative nothing.”