Dedicated to Deposits: Deals, Data, and Discussion
Featured Savings Rates
Featured Accounts
Back to Budgeting and Taxes

Coming Soon: Smaller Raises For Seniors?

Wednesday, July 13, 2011 - 10:28 AM
From SmartMoney.com
When inflation rises, retirees' social security checks keep pace with small increases. But if some lawmakers get their way, those raises may be a whole lot smaller in the future.

As part of the current deficit-reduction talks, White House officials and Congressional leaders on both sides of the aisle are advocating changes to the way inflation is calculated. The little-noticed proposal advocates measuring inflation with the "chained consumer price index," a metric that would likely make inflation look slower than the current measurement does. That would result in smaller Social Security increases for seniors, experts say. "Seniors cannot afford this," says Mary Johnson, a senior policy analyst at The Senior Citizens League, a non-profit seniors rights advocate. "This would negatively impact not just seniors, but also many families that end up helping out these seniors financially."

For the roughly 60% of seniors who rely on Social Security for at least half of their retirement income, this is a big deal. Under the new calculation, the rate of inflation would grow at an average annual rate of about 0.3% less, on average, than under the current calculations....

[Read more...]
4
WhataBummerWhataBummer413 posts since
Oct 15, 2010
Rep Points: 1,702
Reply