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Sunday, May 26, 2019

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2019 Social Security cost-of-living adjustment biggest in 7 years

2019 Social Security cost-of-living adjustment biggest in 7 years

It’s official … the Social Security Administration (SSA) announced last week that Social Security and Supplemental Security income recipients will see the biggest rise to benefits since 2012.

The October 11 announcement of the 2.8% hike in monthly benefits comes on the heels of strengthening economic fundamentals and healthy inflation.

The SSA says the 2.8% cost-of-living adjustment (COLA) will begin with benefits payable to Social Security beneficiaries in January 2019. Increased payments to SSI beneficiaries will start on December 31, 2018.

Hikes generally come in relation to inflation; in years when there is no inflation, there is no increase in benefits. However, benefits are never reduced if there’s no inflation.

This is the largest COLA hike in seven years. Recipients have the ongoing rise of the nation’s inflation rate to thank for the big COLA bump in 2019.

That’s because COLA is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a broad measure of the price of food, energy, health care, housing, transportation and more.

The average monthly Social Security check in June 2018 was $1,413, according to the SSA. The 2.8% increase next year will be roughly an extra $39 on an average check each month.

While that’s not exactly a lot of money, it’s at least something for the 44% of single elderly people who depend on that monthly check for 90% or more of their income.

Social Security recipients got a 2% cost-of-living adjustment in 2018 and 0.3% in 2017. These annual increases are meant to keep up with inflation.