With the consumer price data for May showing inflation falling to its lowest point since March 2021, the Senior Citizens League estimates that Social Security's cost-of-living adjustment for 2024 could drop to 2.7%.
The consumer price index for urban wage earners and clerical workers, known as the CPI-W, the index that's used to determine the COLA, rose 3.6% year over year in May, according to a report released Tuesday by the Bureau of Labor Statistics. That's the lowest level since March 2021, when the CPI-W rose 3%.
Last October, the Social Security Administration announced that it would increase retirement benefits by 8.7% for 2023, the largest cost-of-living adjustment in 42 years.
As for the topline numbers, the consumer price index for all urban consumers rose 0.1% in May on a seasonally adjusted basis, after increasing 0.4% in April, the Bureau of Labor Statistics said, and was up 4.0% over the last 12 months, before seasonal adjustment.
Despite the decrease in the rate of inflation, an ongoing survey through June 6 by the Senior Citizens League shows older consumers are reporting little improvement in their household spending. The survey of 2,275 respondents showed 62% of survey participants reported food costs as their fastest-growing cost, while housing costs are the biggest concern for 22%.
“Since January of this year, the actual inflation rate, as measured by the CPI-W, was lower than the amount older Americans received in their 8.7% COLAs," Mary Johnson, Social Security and Medicare policy analyst at the Senior Citizens League, said in a statement. "That difference theoretically should provide a modest temporary improvement in buying power of roughly $52 per month for a retiree with average benefits of $1,694.”
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