Retirees feel impact as Social Security checks fall short last year: report
Missouri Rep. Jason Smith reacts to Biden aides reportedly discovering another batch of mishandled classified documents and Social Security possibly facing insolvency on ‘The Evening Edit.’
America’s retirees and retirees may have felt the added financial strain in recent months as there was a big shortfall in their Social Security payments last year.
According to the nonpartisan Senior Citizens League, there was a sharp increase in the cost of living in 2022, and inflation-adjusted payments given to Social Security recipients decreased in the same year. This resulted in a 46% gap in the monthly benefit checks received by 70 million Americans.
The organization reported that Social Security recipients received a 5.9% cost of living adjustment (COLA) last January, which saw the average benefit check increase by $92.30, from $1[ads1],564 in 2021 to $1,656.30 for 2022.
However, the league reported that the 5.9% inflation adjustment was below the actual inflation figure each month by 46% on average.
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FILE – Blank Social Security checks are run through a printer at the US Treasury Department’s printing office on February 11, 2005 in Philadelphia, Pennsylvania. (William Thomas Cain/Getty Images/Getty Images)
This calculated discrepancy resulted in the average Social Security check coming up short by more than $42 per month and more than $508 by 2022, according to their report.
“While Social Security recipients look forward to an 8.7% increase in Social Security benefits in January, inflation in 2022 has taken a toll on retiree budgets,” the league said in a statement. “Many retirees have been forced to use savings far sooner than planned, and those without savings have turned to food pantries and low-income assistance programs in greater numbers.”
The inflation-adjusted rate was calculated using 2021’s figures, measured by the consumer price index.
The annual inflation rate for 2021 was 7%, but the adjustment for Social Security benefits is calculated solely based on the change in the third quarter reporting of the Consumer Price Index for Urban Wage and Office Workers (CPI-W).
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The third quarter runs from 1 July to 30 September.
In the third quarter of 2021, CPI-W increased by 5.9%. That rate jumped at the end of the fourth quarter to 7.4%, leaving seniors ineligible even before the start of 2022.
Going forward in 2023, these prices have adjusted again.
FILE – In this photo illustration, a Social Security card sits next to checks from the U.S. Treasury Department on October 14, 2021 in Washington, DC (Kevin Dietsch/Getty Images/Getty Images)
As of January 2023, Social Security benefits have increased by 8.7% or about $140, increasing the average check to nearly $1,800.
This increase was again calculated through third quarter inflation rates: Inflation was 7.1% in November, down from a shockingly high 9.8% in June.
Federal agencies predict that 2022 will end with an annual inflation rate between 7% and 8.01%.
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An elderly couple walks on a street in Alhambra, California on February 4, 2020. (FREDERIC J. BROWN/AFP via Getty Images/Getty Images)
As retirees look forward to the increase in Social Security payments in 2023, many are still struggling with 2022’s shortfall between inflation and Social Security payments.
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The Senior Citizens League reported that 33% of seniors applied for food stamps or visited a food pantry this year, compared to 22% last year, and that 17% applied for help with heating costs, compared to 10% last year, according to a recent study.
The Associated Press contributed to this report.
