The increase for the Cost-of-Living Adjustment (COLA) for 2022, which will affect the amount that Social Security beneficiaries get monthly, will most likely be announced this Oct. 13. This timeline is based on last year’s announcement for the 2021 COLA increase, reports Yahoo.com.
Although there is no confirmation about the date yet, many are expecting that the announcement will be made during the same time. The increase is said to be 6 to 6.1 percent, the biggest in years, and this will be confirmed once the announcement is made.
How Is The COLA Computed
The COLA is computed based on the Consumer Price Index for Urban Wage Earners and Clerical Workers. The computation will be based on July, August, and September, and the increase will be in effect on January 2022.
The Latest Projection
The Senior Citizens League has been keeping Social Security beneficiaries updated regarding the most significant increase in decades. Per their latest estimate, they projected that the increase would be around six to 6.1 percent. This is a slight dip compared to the 6.2 percent projection last month.
Mary Johnson, Social Security policy analyst for The Senior Citizens League, shared, “This year is particularly difficult to forecast with certainty. The inflation patterns caused in large part due to the COVID-19 pandemic were unprecedented in my experience. Price changes due to climate disasters throw a monkey wrench into a thing on top of the difficulty in watching run-up in costs earlier this year.”
The Effect Of The Increase
There hasn’t been a sharp COLA increase in recent years because there are no high inflation rates. GOBankingRates reported that the U.S. economy has been operating at near-zero inflation for the better part of the last decade. This year, however, prices have gone up, and with the anticipated increase in Social Security benefits, experts are saying it won’t do much for the beneficiaries. According to the Motley Fool, the extra funds brought about by the increase will most likely make up for the inflation.