10% cost of living adjustment in 2023. Wait, what is this? Yeah, exactly. This would include Social Security, retirement, disability, SSDI survivors, SSI and VA. Beneficiaries, I have all the details for you on this topic. All right, so while we are dealing with some big and serious numbers here, so I want to share with you some new information that I came across in regards to what is going on here in 2022. All right, so let’s step back for just a second here. Through the fourth quarter of 2021, we saw inflation really, really picking up.
Well, it translated into 2022 and thus far into 2022. Inflation continues to rage higher and realistically, according to what the experts and analysts are saying right now, it is not stopping or slowing down anytime soon, especially with everything going on around the country right now and around the world. Therefore, the experts and the analysts are actually anticipating we could be seeing over 10% inflation in mid-2022. Well, as a result of that, we’re also watching everything very closely and they’re starting to show a little bit of emergence when it comes to the potential cost of living adjustments. Cola raise for 2023.
I want to lay that out for you on this topic now. Full Disclaimer before we get into it any further, of course, the official announcement will be made by the Social Security Administration, usually in mid-October. So nothing is official. Nothing is confirmed until the Social Security Administration actually does actually announce the official cost of living adjustments, otherwise known as the Cola Rays, for the following year. And again, that usually happens in about mid-October.
So that is going to be the official number. However, we’re watching everything closely right now, and we need to take into account a couple of different dates and months going forward here that we need to watch very closely if these analysts and experts are actually correct. Now, here’s what we have to say about this. It’s one of these situations where, yes, a nice big Cola raise would be great, but at the same time, we also need to recognize this is specifically pegged right off of the inflation numbers. So at the same time, a big Cola raise would be nice.
It’s actually not a good thing because that just means that if it comes in really big, that also means that inflation is very high. So it’s one of those situations where it’s like maybe we really don’t want a big Cola rays. But here’s what it comes down to. According to everything that we’re looking at right here, right now, analysts are looking at the current situation and saying, okay, according to the global situation, according to the situation all around the country, everything right now with the supply chain, energy and all this other situation going forward, we could potentially be looking at inflation, just the CPI numbers in the United States hitting 10% or possibly even higher sometime in mid-2022. Even with intervention from the Federal Reserve, it doesn’t really matter.
They’re still going to continue moving higher unless the Federal Reserve really steps in aggressively and does something to actually lower this inflation. But realistically, they’re not going to do that. They’re not going to step in so aggressively that it lowers inflation so substantially down to the levels that it needs to be. So unless the Federal Reserve comes in and really does something really, really big and aggressive, highly doubt that’s going to happen. But if they do, then this could potentially change the trajectory of this inflation going forward.
But here’s what it comes down to. As we know, the months that we need to watch very closely are the third quarter of 2022, because these are the months and the inflation data that will actually peg the cost of living adjustment for the following year. So the months of July, August, and September, these three months are the ones that are actually put into the Hopper. These are the ones that are used for the calculation to determine the cost of living adjustment for the following year. So when we get into these months here in 2022, July, August, and September, we will need to watch the inflation data very closely during these months.
Now, again, this is perfectly in line with what the analysts and experts are saying. As of right now, inflation continues to move higher. And if it continues moving higher at the rate that we’re seeing, we could potentially be seeing 10% or possibly even higher by the time we get to July, August, and even September of this year. Not a good thing, right? Because remember, as inflation continues to move higher, this is just eating away the purchasing power of our dollars, the dollars that we’re getting, especially for the low income and the fixed income.
It is not a good thing. Anyway, let’s keep rolling here and talk about some more things here. So we will need to watch the CPI, the Consumer Price index. This is the data point that actually measures inflation on a month-over-month basis. This number comes out usually in the middle of the month, each and every month.
And it gives us a reading on the inflation data for the previous month. So we’ll need to watch these numbers very closely. The first data point that we’re going to be receiving will actually be released in August. That will be the inflation number for July. So, like I said, the July inflation number will be released in August, the August inflation number will be released in September, and the September inflation number will be released in mid-October.
Usually, the Social Security Administration comes up shortly thereafter, usually the same day, and releases the cost of living adjustment when we get that September inflation number released in mid-October. So these are going to be some very important months. And remember, they take this inflation data from these three months, July, August, and September. They take this data, they run it through their calculations. And this is what gives us the cost of living adjustment that goes into effect as of January of the following year.
So even if the Social Security Administration comes out and announces whatever they do in mid-October of 2022, that actual raise would not go into effect until January of 2023. But according to what we’re looking at right here, right now, we may be in for a massive raise. This would be a huge, huge raise that we have not seen for many decades, possibly even ever, based on how big this thing actually comes in at. So we’ll have to continue watching all this stuff very closely. We will also need to continue watching what the President and what Congress does going forward as far as do they pass any kind of legislation?
Do they have any additional stimulus packages? Do they offer stimulus checks? What do they offer going forward to help the low income and the fixed income with all of this massive inflation? We’ll also need to watch very closely the Federal Reserve and see what they do going forward, see if they aggressively raise interest rates. If so, that could potentially lower inflation a little bit.
But again, they would need to raise rates pretty aggressively in order to get inflation lowered down to the ranges that we actually want it to be about two and a half to 2%. That’s a long cry from where we’re currently sitting right here right now. So anyway, came across this information. I want to lay it out for you. But again, full Disclaimer.
Nothing is official until Social Security actually announces that, again, it’ll be happening in mid-October is when we will get the official announcement on the cost of living adjustment. Now, again, I know we’re talking about this kind of early here, but based on the information that I’m finding out there, this is what the analysts this is what the experts this is what people are talking about right here, right now, as far as inflation goes and how this could actually translate into a massive cost of living adjustment for 2023. Now, again, I do also recognize that many of you down in the comments section, I read the comments all the time saying, hey, the Cola, it’s great but at the same time it’s not good because when I get the call to raise they reduce my other benefits. They take it all away from the Medicare part B premium, all of these things. And ultimately for a lot of people, net it’s not really a good thing, right?
You maybe get a $20 raise on your benefit but at the end of the day they take $25 worth of other benefits away or in the form of increasing Medicare part B. So yeah, I totally get it. But either way we still got to watch this very closely because realistically it’s going to impact all of us, the 65 to 70 million beneficiaries who receive these benefits that are actually impacted by the Cola race and got to watch this stuff because this is what’s going to happen going forward. And maybe by the time that we get to July, August and September, maybe inflation drops so much by then that we’re looking at maybe just a small Cola raise, maybe 4%, maybe five, maybe three, maybe one. Honestly, we have no clue what it’s going to be at that point.
It’s all going to be pegged on what happens with the supply chain issue, what happens to the money supply, what is happening around the country, what is happening globally and what is happening with the federal reserve and interest rates. A lot of things, a lot of moving parts. Anyway, this is what I got for you right now. Of course, just like everything else, I’ll continue watching it as I get more information. I’ll catch you again later in the next update, thank you.