A 3.2% Cost of Living Adjustment (COLA) in Social Security checks in 2024 will result in an increase of $57.30 of the average monthly benefit of $1,790 a retiree would receive.
The estimate was made by The Senior Citizens League (TSCL), a non-partisan entity that ensures the rights of retirees.
“Although the 3.2% COLA is significantly lower than the 8.7% received in 2023, the highest in more than four decades, higher than the average of the last 20 years – which is 2.6%. The Social Security Administration is expected to announce the 2024 COLA in mid-October,” TSCL recently explained in a statement on its website.
Historically, TSCL made the COLA projections several months before the official announcement date in mid-October.
Last year, the Social Security Administration (SSA) announced an 8.7% COLA on October 13 which is available now.
TSCL estimates an increase of 3%. The slight increase to 3.2% was in response to the increase in the price of consumer goods through August.
The SSA needs inflation numbers through September to establish the COLA amount. which will be available next year.
Compatibility is determined by calculating, comparing and averaging the levels of inflation during July, August and September of the current year with the same quarter but last year.
Based on the law, since 1975, that office has been calculating the COLAs. The change was implemented through legislation linking the measurement of annual increases to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
In other words, the tool used by the SSA to calculate the COLA is the CPI-W from the Bureau of Labor Statistics (BLS) of the Department of Labor.
The adjustment seeks to ensure that recipients of Social Security programs have the purchasing power to face rising costs of goods due to inflation; or, in other words, that inflation does not reduce the value of Social Security benefits.
About, 70 million people in the US will receive checks starting next January in the new increase.
This group includes Supplemental Security Income (SSI) beneficiaries who will be paid first, according to the delivery schedule used by the agency.