What can you expect with the Social Security Cost of Living Adjustment (COLA) for 2022?
Over the last 10 years, the average cost of living increase in social security has been 1.65 percent. The COLA for 2022 was recently announced to be 5.9 percent. This is the largest COLA increase since 1982. Now, some people are happy about this, and some people are upset.
The people who are upset are worried about estimates that Social Security Trust Funds won’t be able to pay the full benefit as early as the early 2030s. This isn’t going to help much if they’re giving this sort of inflation or Cost of Living Adjustment.
I guess the government knows that they’re going to have to fix Social Security and the Trust Funds at a later date. Click here to see a video I recorded about Social Security running out of money.
But in the meantime, they have to focus on current inflation. And the fact is that the cost of goods is going up. So, the COLA increased because inflation has increased.
New Social Security Statements
Now, if you’re not taking Social Security yet, there is a new revamped statement available. This statement can help you know what to expect if you’re still thinking through the ideal strategy for you on when to start taking Social Security.
The format of the previous statement was four pages and it was a lot of text. One section showed your benefit amount at three key ages: 62, full retirement age, and 70.
The new statement is just two pages and gives you more information and make it easier to understand. The acting commissioner of SSA said that this streamlined Social Security statement contains clear messaging. It makes it easier to find information at a glance.
The first page shows your full retirement age and estimates based on your earnings to date. It assumes you will continue to make the same amount until you start your benefits. That’s very helpful. It’s more information than what they gave before.
There is also a chart that shows the expected benefit each year, instead of just at 62, full retirement age, and 70.
The second page shows your earnings record and also taxes paid, which might only be interesting to fellow numbers nerds like me.
You should be able to access your updated Social Security statement at the Social Security Administration website: ssa.gov