The Social Security Administration announced that it will increase benefits by 3.2% for recipients in 2024. The SSA’s announcement came as the Bureau of Labor Statistics released the updated consumer price index, indicating the price of goods and services increased 3.7% in the 12-month period ending in September.
About 66 million Social Security beneficiaries will get the 3.2% cost-of-living adjustment starting in January. Nearly 7.5 million people receiving SSI will get the adjustment starting on Dec. 29.
Recipients will average about $50 more in benefits per month.
“Social Security and SSI benefits will increase in 2024, and this will help millions of people keep up with expenses,” said Kilolo Kijakazi, acting commissioner of Social Security.
But some experts have said Social Security has failed to keep up with actual costs incurred by recipients.
According to the Senior Citizens League, people who retired before 2000 have lost 36% of their buying power. On average, these retirees, generally over age 85, would need an extra $516 a month to maintain the same buying level as 2000.
The reason is that the prices of items that seniors typically buy have increased faster than other items. According to the Senior Citizens League, Social Security’s cost-of-living adjustments have raised payments by 78% from January 2020 through February 2023. But the organization says the prices of items typically purchased by seniors have jumped 141%.
The Social Security Administration says it bases its cost-of-living adjustment on the consumer price index for urban wage earners and clerical workers. The Bureau of Labor Statistics releases consumer price index data monthly.
The consumer price index weighs the costs of goods based on their importance. Items like food, shelter and energy tend to be weighted more heavily.
The last cost-of-living adjustment came in December 2022 when the Social Security Administration increased payments by 8.7%. Last year’s increase marked the largest jump in nearly four decades.
The upcoming increase represents the eighth time since 2000 that the rate has increased more than 3%.