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Historically small benefit increase expected second year in a row

On behalf of Jeffrey Rabin of Jeffrey A. Rabin & Associates, Ltd. posted in SSA on Thursday, October 24, 2013.

After this most recent recession, many people wondered how the state of the economy was going to fare.  Then just weeks ago, the government shutdown added more fears, especially about the stability of government spending and what this would mean for people who rely on government assistance programs to stay financially afloat.  But now with the recession long behind us and services slowly returning to normal in the government, people are starting to wonder if this forecasts good things for beneficiaries down the road.

The answer is a tentative yes.  That’s because, even though the Social Security Administration announced that it was preparing to raise the amount of benefits that recipients receive, it was admitted that the amount would not be as large as people had hoped.  According to reports, this will be the second straight year of historically low increases to Social Security payments.

Preliminary estimates peg the increase at about 1.5 percent. But if we do the math, that will mean an average increase of about $17 per month. Cost of living increases may also be small. Because of the government shutdown, the Labor Department has not been able to release the inflation report for September, which SSA uses to determine raises in cost of living expenses. That leaves nearly 58 million beneficiaries waiting for any news before the month is out.

While the government tries to figure out a middle ground between balancing the budget and providing more to SSA beneficiaries, millions of Americans across the nation may be wondering how they will pay their household bills with fixed incomes while the prices around them continue to rise.

Source: The Huffington Post, “Social Security Increases Are Historically Small This Year,” The Associated Press, Oct. 13, 2013

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