The Social Security increase for 2014 is expected to be around 1.5 percent. While the words “Social Security increase” might sound great, the reality is that a 1.5 percent increase in Social Security for 2014 would mean that for the average monthly Social Security payment of $1,162, “a 1.5 percent raise would increase the typical monthly payment by about $17,” reported the Associated Press on Oct. 13, 2013.
Nearly 58 million retirees, disabled workers, spouses and children get Social Security benefits and receive an average monthly payment of $1,162. According to an analysis by the Associated Press, preliminary figures show that the expected Social Security increase for 2014 is to be around 1.5 percent – a whopping $17 a month more.
A Social Security increase of 1.5 percent would be among the smallest increases since 1975.
The exact Social Security increase percent for 2014 depends on COLA, the cost-of-living adjustment that is usually published by the Labor Department in September.
Unfortunately, due to the government shutdown, the Labor Department was not able to publish COLA on Wednesday, as it was supposed to happen. The final and exact Social Security increase will be delayed indefinitely until the government shutdown is resolved and all departments can resume work.
According to several news sources, however, the Social Security increase of only 1.5 percent is expected because average prices for July and August were only 1.4 percent higher than they were a year ago.
“By law, the cost-of-living adjustment is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W, a broad measure of consumer prices generated by the Bureau of Labor Statistics. It measures price changes for food, housing, clothing, transportation, energy, medical care, recreation and education. The COLA is calculated by comparing consumer prices in July, August and September each year to prices in the same three months from the previous year. If prices go up over the course of the year, benefits go up, starting with payments delivered in January.”
Many Social Security recipients consider COLA to be an insufficient reflection of the true cost-of-living expenses because it does not include the high cost of medical costs, which, unlike consumer prices, went up 2.5 percent.
Max Richtman, who heads the National Committee to Preserve Social Security and Medicare, points out that COLA does not adequately reflect the expenses of Social Security recipients and that a 1.5 percent Social Security increase for 2014 would be insufficient.
“This (COLA) is not enough to keep up with inflation, as it affects seniors. There are some things that become cheaper but they are not things that seniors buy. Laptop computers have gone down dramatically but how many people at 70 are buying laptop computers?”