Social Security recipients to get hike
WASHINGTON — Some 55 million Social Security recipients will get a 3.6 percent increase in benefits next year, their first raise since 2009, the government announced Wednesday.
The increase, which starts in January, is tied to a measure of inflation released this morning.
About 8 million people who receive Supplemental Security Income also will receive the 3.6 percent cost-of-living adjustment, or COLA, meaning the announcement will affect about one in five U.S. residents.
There was no COLA in 2010 or 2011 because inflation was too low. Those were the first two years without a COLA since automatic increases were adopted in 1975.
Monthly Social Security payments average $1,082, or about $13,000 a year. A 3.6 percent increase will amount to about $39 a month, or just over $467 a year, on average.
Advocates for seniors said the raise will provide a much-needed boost to the millions of retirees and disabled people who have seen retirement accounts dwindle and home values drop during the economic downturn. Economists say the increase should provide a modest boost to consumer spending, which should help the economy.
Federal law requires the program to base annual payment increases on the Consumer Price Index for Urban Wage Earners and Clerical Workers. Officials compare inflation in the third quarter of each year — the months of July, August and September — with the same months in the previous year.
If consumer prices increase from year to year, Social Security recipients automatically get higher payments, starting the following January.