Why Social Security Is Failing Seniors
Millions of older Americans rely on Social Security as their primary source of retirement income. That’s why the annual cost-of-living adjustment (COLA) is so critical, especially during inflationary times. The problem, according to a Yahoo! Finance article, is that the way the COLA is calculated tends to fail seniors because it does not reflect actual spending.
Social Security COLAs are based on third-quarter changes to the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W. But the expenses that Social Security recipients face tend to be different from those of working people. The article points out that Social Security beneficiaries “tend to spend a large portion of their income on healthcare, which is not heavily weighted in the CPI-W.”
Advocates, like those of us here at The Seniors Trust, want to see a senior-specific index used to calculate Social Security COLAs.
A Better COLA Calculator
We believe the Consumer Price Index for the Elderly, or CPI-E, should be used to calculate the COLA. This index shows how inflation actually impacts the typical retiree based on seniors’ spending habits.
We want Congress to enact the Social Security Expansion Act. It calls for adopting the CPI-E as the COLA calculator, better ensuring that Social Security benefits keep pace with inflation.
Additionally, this landmark piece of legislation would also extend the solvency of the Social Security trust fund through 2096, expand Social Security benefits by about $200 a month for current and new beneficiaries, require millionaires and billionaires to pay their fair share into Social Security by lifting the wage cap, and improve the Special Minimum Benefit for Social Security recipients which would help low-income workers stay out of poverty.
Is this something you can get on board with? Join us in urging lawmakers to enact the Social Security Expansion Act. You can show your support by signing our petition.
