Your Money – Slight Increase in SS Benefits for 2013
According to an estimate by the American Institute for Economic Research, recipients of Social Security benefits will see a slightly less than 2 percent cost-of-living increase next year. Better than nothing, but is it keeping up with the actual cost of living index?
Actually, on average folks on Social Security will see an increase between a 1.5 percent and a 1.7 percent hike in 2013. That is down fairly significantly from the 3.6 percent seen last year. Still, it's much better than in 2010 and 2011 when there was no increase at all.
Later this month, the Department of Labor is set to issue its final report used to determine annual cost-of-living adjustments; increases to Social Security will be announced simultaneously.
Unfortunately, the expected increase will likely not be enough to actually balance out the cost increases felt by the majority of senior citizens, according to Steven Cunningham, director of research and education for AIER. Cunningham says that the cost of things like food and beverages, fuel and medical care, which make up the majority of senior spending, has increased 2 to 4 percent.
"They're falling behind by about a half percentage point a year or so. It's not a huge amount, but over time that adds up," said Cunningham.