The big Social Security myth floating around. I have all the answers and everything you need to know right here on this topic. As I am very much dedicated to you and this community and I’m here for you every single day to help you out in any way that I can.
you know that I have an emphasis on the low-income seniors, elderly people with disabilities, fixed income beneficiaries of Social Security, SSDI, retirement survivors, SSI, VA and RRB, as well as so many other people out there who are struggling during this time.
Let’s jump right into this. So, as you probably know, throughout your entire life, you’ve probably been hearing multiple different myths floating around about Social Security. Well, right now is certainly no exception to that rule. There are a lot of myths still floating around out there. Well, I do want to talk about one right here in this topic that I’ve seen coming across the headlines a number of different times here over the last few days.
And I thought you know what? It is about time to make a dedicated topic talking about this one, simply because if I’m seeing it as many times as I have, I’m guessing some of you are probably either seeing this as well or hearing about it somewhere out there. And I want to shake it all out, let you know what’s actually going on with this, because this one is actually directly related to your monthly benefit. Now, there’s a lot of different information floating around out there about Social Security. And when it comes to our monthly benefits, this is a very sacred topic.
In fact, I see it down in the comments section all the time. Many of us here in this community rely on that monthly benefit as the only source of income on a monthly basis. So I know it is a very sacred topic. If anything happens to those benefits, it is a big deal for a lot of people. So I do want to talk about this one right here on this topic.
So let’s talk about it and discuss what is this myth and what are all the details about it. So the myth says it is a guarantee that you will get a Cola raise or cost of living adjustment every single year, right? No. In fact, no, it is not a guarantee that we would get a cost of living adjustment every single year. In fact, there are a few years over just the last ten or so years alone, there are three different years where we got a 0% cost of living adjustment.
The years are 2010, 2011, and 2016. During these three years, there was a 0% cost of living adjustment. Now, throughout the same period of time, there were also many years out there where we got a fractional raise to our benefits. In fact, just a couple of years ago, we got a 1.3% raise, which at the time seemed like, oh, that’s actually kind of generous considering the years leading up to that were a fraction of 1%. Now for this year alone, in 2022, all of us know it is 5.9%, which once again, is way behind the curve.
It should be more around the seven and a half to probably even 8% considering where inflation currently sits right now. But that leads us into where does the cost of the adjustment, or Cola rays, actually come from each and every year? Well, it’s based on the inflation data that comes out of the months of July, August, and September. The quarter three throughout the previous year will actually determine what the cost of living adjustment is going to be for the following year. So this year, the inflation data out of July, August, and September will determine the cost of adjustment for next year, 2023.
Well, at the current rate that we’re going right now with inflation, we’re probably going to be looking at a pretty healthy cost of living adjustment once again in 2023. Now get this right now, this year we are experiencing the highest cost of living adjustment 5.9% that we’ve seen since 1982. In 1982, it was 7.4%. But guess what? Next year in 2023, we’re probably going to see a higher cost of living adjustment than the 1982 number.
So that’s going to be a big, big number next year in 2023. But again, we won’t know that here for a few more months. However, this is something we certainly need to watch right now because this does directly relate to your monthly benefit. However, did you know this about the Cola? Prior to 1975, the annual cost of living adjustment was actually determined by Congress.
Could you imagine having Congress determined what the call is going to be? Oh, man, I can’t even imagine what that would be. I don’t think I want to rely on Congress to do anything else for us right now, considering they’re doing absolutely nothing. Right. So I think Congress is the last group of people that I would want to determine the cost of living adjustment for us on an annualized basis.
But again, prior to 1975, they were the people who actually did it. So I don’t know, kind of an interesting point right there. But ever since then, the Cola has been indicated or dictated, I should say, by inflation. And the Social Security Administration runs their formula runs their calculation based on those three months Q three from the previous year to determine what the Cola will be for that upcoming year. So again, some pretty interesting information out there. But this is the main headline that I’ve been seeing out there a number of different times here over the last few days. It’s one of those things that I read on it and that’s like, okay, and then just kind of dismiss it because I feel like I probably shouldn’t talk about that. But I’ve seen it coming up here so many different times here over the last three, four, five days or so.
I feel like, you know, what, if I’ve seen it this many times popping up, obviously it is something that is being talked about. There’s people that are seeing this. And I thought, you know what? I want to be here for this community as I always am, in any way that I possibly can be. I’m doing all the research and breaking it all down for you in these topics.
So I want to make sure that you understand what is actually going on with this. And when it comes to the annual cost of living adjustment, cold to raise it is not a guarantee. Not at all. There’s pretty much no guarantees when it comes to all this stuff, right. Even our monthly benefit, even though they say, oh, it’s your promised monthly benefit, right.
Well, in about ten years from now, just like we’ve discussed so many times, those promised benefits may be shaved by about 22%. So, yeah, so much for promised benefit. Right. But again, we can open up a can of worms on that one here in a separate topic. But that is a whole another major issue that we’ve talked about previously on other topics.
But yeah, another major issue that Congress has on their hands that they’ve got to get something figured out for that. Otherwise, we could be seeing a major, major haircut to our monthly benefits in about ten years. But again, ten years is a very long time. We don’t need to worry about that. So please don’t worry about it.
But that’s just another major issue out there right now. So anyway, coming out, breaking down some myths for you. But again, I want to be here to help you out in any way that I can.
I’ll do my best to answer them as I always do. But again, if I do not answer directly to your comments, please do not take it personally at all. I do my best to read as many comments even though I cannot respond to all of them. I do read all well, not all of them. I try to read all of them, but honestly, I do my best to read all of them.
I hope this one helps you out and breaks it all down to let you know what is going on with the cost of living adjustment and in just a matter of a handful of months here the year is already zipping on by. We will be getting the next cost of living adjustment reading but we’ll need to continue to see what the inflation does coming forward throughout the course of 2022 and that’ll actually indicate where the Cola will be for 2023. Now remember this is based on the CPIW consumer price index for urban workers and clerical workers. That’s what that stands for. However, they’re considering changing it to the CPI consumer price index for the elderly which would actually better reflect those actual costs that the elderly and people with disabilities actually do endure on a regular basis because this is what fixed income beneficiaries otherwise known as Social Security beneficiaries typically experience on an ongoing basis.
Kind of makes sense. So anyway, as I do get more information on all of this of course I’ll be right back here for you breaking it all down to help you out in any way that I possibly can so please enjoy your day, stay safe out there, leave your questions and comments down below and I’ll do my best to answer them as well as make dedicated topics as necessary to be here for you to help you out in any way that I can all right, enjoy your day and I’ll catch you again later in the next topic.