According to a recent report from Atticus, the majority of seniors have talked about there dissatisfaction with the cost-of-living adjustment (COLA) for 2024. Roughly, 62 percent of the 400 Americans over the age of 62 in the survey said they were unhappy with the payment bump.
"About that 3.2 percent COLA increase for 2024, well, it sounds good on paper, but, honestly, it's not quite cutting it for seniors," said Christopher Hensley, financial adviser and the president of Houston First Financial Group.
The concerns are growing, there are three in five seniors said they were struggling financially, and 70 percent of single seniors already struggle with their existing Social Security income. The after-effect of a small COLA boost could be severe for some seniors, with around two in five seniors saying they plan to seek employment due to this small increase. For single seniors specifically, 47 percent said they would consider employment to supplement their incomes.
Hannah Workman, a member of the creative team for Atticus said, “While the 3.2 percent adjustment acknowledges inflation, it's insufficient against the rise in all essential living costs such as utilities, healthcare, and food.” "The need for nearly 40 percent of seniors to consider employment underscores the disconnect between the COLA increase and the reality of seniors' expenses."
Some people feel the consumer price index (CPI) doesn't fully reflect the reality of what older adults are going through every day. The CPI-E reflects a better measure of what people aged 62 and older spend their money on.
"It's a big deal because things like healthcare, which, let me tell you, can be a major expense, weigh more in the CPI-E," Christopher Hensley said. "Seniors often end up spending way more on healthcare than younger people, and those costs just keep climbing as they get older."
"So, when the COLA is based on that, it doesn't really match up with the real-life financial squeeze they're feeling, especially with healthcare costs, which seem to be always on the rise," Hensley added. "This mismatch has some serious consequences." Millions of seniors rely on Social Security for the bulk of their retirement income, so making sure the payments keep up with inflation is vital for their survival, said Drew Powers, founder of Powers Financial Group and a registered investment adviser.
Seniors tend to spend more on medical care, the costs of which typically increase more than the general inflation rate," Powers told Newsweek. "This year's decrease in gasoline prices plays a big part in the overall lower inflation numbers, but seniors do not spend a lot on gasoline as the younger generations who may be commuting and by shuttling kids to their activities." Some seniors are dealing with the effects of inflation when it comes to their everyday grocery expenses, which the COLA increase might not fully reflect. In the most extreme cases, this small COLA bump could cause some seniors to delay retirement altogether.
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Walter Norris
12-29
what did Nancy Pelosi call it peanuts
Michael T
12-29
We get a raise, but inflation takes it away, so there is NO RAISE!
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