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Cost-of-living hikes coming for Social Security recipients

November 8, 2011

Social Security and Supplemental Security Income recipients will be receiving their first cost-of-living-increase, 3.6 percent, in three years. Photo courtesy

Social Security and Supplemental Security Income recipients will be receiving their first cost-of-living-increase in three years. Recipients will begin seeing their first income increases in December and January, the first they’ve seen since 2009.
The granting of COLAs, based on a complicated mathematical algorithm, has been delayed due to an overall unhealthy economy.
“I’m thrilled, especially for Inyo County seniors,” said Jean Turner, director of Inyo County Health and Human Services, the agency that also oversees local senior programs. She said for seniors, many of whom are on a very low, fixed income, the lack of COLAs has been especially hard with current spikes in fuel and food prices.
SSI benefits are not based on prior work history but on need of the recipient, such as disability benefits. Social Security is based on prior wages and taxes paid.
Inyo County had a total of 463 SSI recipients as of December 2010. Of the majority of those recipients, 389 are blind or disabled, 74 are considered elderly and 308 are aged 18-64, according to statistics provided by the U.S. Social Security Administration. There are a total of 4,125 Social Security recipients in the county, or 23.9 percent of the county’s population.
As defined by the Social Security Administration, this means they qualify for Social Security’s Old-Age, Survivors, and Disability Insurance.
Turner added that she knows of many local seniors who have been “very worried” about COLAs and have been following every action in Washington, D.C.
The 3.6 percent COLA will begin for the U.S.’ approximately 55 million Social Security beneficiaries January 2012. Increased payments to more than 8 million SSI beneficiaries will begin on Dec. 30.
According to the Social Security Administration, the average per capita monthly amount for Social Security and SSI recipients in Inyo County is $2,998. Nationally, the per capita average is $2,199 and in California it is $1,704.
According to the Social Security Administration, adjusting cost-of-living income is necessary to “ensure that the purchasing power of Social Security and SSI benefits is not eroded by inflation.”
The process for determining COLAs, however, is complicated, as explained by the Social Security Administration
“Social Security and SSI benefits are adjusted to reflect the increase, if any, in the cost of living as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) prepared by the Bureau of Labor Statistics …
“For purposes of determining the COLA, the average CPI-W for the third calendar quarter of the last year a COLA was determined is compared to the average CPI-W for the third calendar quarter of the current year. The resulting percentage increase, if any, represents the percentage that will be used to increase Social Security benefits beginning for December of the current year. SSI benefits increase by the same percentage the following month (January). If the increase in the CPI-W is at least one-tenth of one percent (0.1 percent), there will be a COLA. However, if the CPI-W increases by less than 0.05 percent, or if the CPI-W decreases, there will not be a COLA.”
Turner said that the feds’ use of gauging when COLAs are applicable may seem unrelated to Social Security, but, she explained that there must be some sort of “anchor” or something concrete to cite how the numbers are calculated and estimated.
In a related matter for seniors, Turner explained current talks between Inyo and Mono counties about the regional administrative costs of the Inyo Mono Area Agency on Aging continue.
She said she wanted the community and seniors to know, “We have no intent in disrupting services.”

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