Tampa, FL (Law Firm Newswire) November 26, 2012 – There is a cost-of-living (COLA) adjustment going to 56 million U.S. residents receiving Social Security benefits and 1.9 million federal retirees.
However, it is too small of an increase to change many budgets, senior advocates say.
The 1.7 percent increase may be one of the last for a while, if concerned Social Security advocates are correct. The latest cost-of-living adjustment increase known as 2013 COLA was recently announced by the Social Security Administration, and was just over half the 3.6 percent increase introduced for last year. Advocates are concerned that the annual increases, as small as they tend to be, will be erased going forward, as part of efforts to reduce the deficit.
According to the Senior Citizens League, 65 percent of older Americans receiving Social Security use the funds to make up at least 50 percent their household income. League policy analysts state that the COLA boost does little to help when Medicare premiums are also rising. Health care, heating and food costs are all rising, which are not reflected in the boost.
“Unfortunately, the increase does not keep up with inflation and does little to actually help seniors with their finances,” stated Tampa Social Security attorney David Magann.
While policymakers are looking at how the country’s deficit might be curtailed, including cuts to Social Security, and a decrease in how the cost-of-living adjustments are calculated, The American Association of Retired Persons (AARP) has stated that decreasing the COLA for deficit reduction would only exacerbate the financial hardships they face.
An annual survey of senior costs conducted by the Senior Citizen League reports that the seniors have lost funds due to the COLA increase not accurately reflecting the U.S. cost-of-living increase, and the elderly have lost in excess of one-third of potential buying power since 2000.
COLA increases have averaged 4.5 percent per year since the automatic annual adjustments to Social Security benefits first began in 1975. There were no increases for the years 2010 and 2011, due to low inflation. Due to fuel price increases and a sluggish economy, analysis say there may not be a COLA increase for 2013.
Magann has been practicing social security law for 14 years and recently completed his 1,400th hearing. Magann is a Marine Corps Veteran who earned his law degree at the University of Miami, and has a criminology degree from the University of South Florida.
David W. Magann, P.A.
156 W. Robertson St.
Brandon, FL 33511
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Tampa, Florida 33615
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