Social Security Benefit Increase to Remain Low
COLUMBIA - Retirees eligible for Social Security benefits will likely receive another historically small increase in their benefits in 2014, according to early projections.
The Social Security Administration uses the Sept. Consumer Price Index (CPI) to calculate a Cost-of-Living Adjustment (COLA) for the next year. The CPI measures changes in what prices consumers pay for certain goods and services. The federal government uses the CPI as an inflation indicator.
The U.S. inflation rate has hovered around 2 percent in recent years, so the COLA has not changed much. In three of the last four years, recipients have seen little or no increase in benefits.
In 2010 and 2011, Social Security recipients did not receive a benefit increase after the COLA was calculated. In 2012, beneficiaries received a 3.6 percent increase.
In 2013, recipients saw a 1.7 percent increase in their benefits after the government calculated the COLA.
The American Institute for Economic Research estimates the COLA will lead to another small benefit increase for 2014 of about 1.5 percent.