ST. PETERSBURG, Fla. — If you're one of the millions of Americans who receive Social Security benefits, you could see the biggest cost-of-living adjustment since 1981 starting next year, according to recent reports.
This is due in part to the record-high inflation we've been seeing over the last eight months.
A typical monthly Social Security check is about $1,658, according to CBS News. With the projected increase, beneficiaries could see about $142.60 per month added to their checks starting in 2023. That would bring average checks to about $1,800 every month.
CBS News says the 8.6 percent jump to Social Security checks could provide some relief for millions of Americans, as many are struggling to keep up with surging costs for everything from groceries to gas.
However, the Senior Citizens League says the high inflation is hurting Social Security beneficiaries now. Currently, they have lost about 40 percent of their buying power since 2000, the advocacy group says.
CNBC says this year Social Security beneficiaries got a 5.9 percent bump to their monthly checks, which is the highest increase in about 40 years.
And, the news outlet adds if inflation subsides, a bigger COLA adjustment next year isn't guaranteed. And, the percentage could lower or not even increase if that happens.
The Social Security Administration says it has a specific formula for calculating each COLA. They're based on increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The Bureau of Labor Statistics calculates CPI-Ws on a monthly basis.
That's slightly different than the normal Consumer Price Index that the bureau uses to calculate monthly price increases that are affected by inflation.