Social Security Payment Adjustment Predicted To Be 2.8 Percent In 2027, Group Says

Authored by Jack Phillips via The Epoch Times (emphasis ours),

A seniors group said it is forecasting the cost-of-living adjustment for next year’s Social Security payments to remain steady at 2.8 percent as U.S. officials released the latest consumer inflation data on Wednesday.

The Senior Citizens League on Wednesday released its forecast adjustment for 2027’s Social Security and Supplemental Security Income (SSI) payments.

“That would be the exact same as last year’s COLA of 2.8 percent, a far cry from the 8.7 percent COLA issued in 2023 to help benefits keep pace with pandemic-related inflation, which seniors continue to see as a top issue,” the group said, according to a news release.

Government inflation data for the months of July, August, and September compiled by the Social Security Administration (SSA) is used by the agency to produce the COLA for the next year’s payments. The SSA usually announces the COLA in October following the release of September’s Consumer Price Index (CPI) data.

The seniors league said that with “lagging COLAs and Social Security’s funding creeping into dangerous territory,” it has found that many seniors have “lost faith in Congress” to act on the program. It also said it found that three in four seniors don’t believe Congress will be able to act on reports saying that Social Security will go insolvent by the early 2030s.

“Even before potential benefit cuts, most seniors think their benefits are falling behind inflation,” the league said Wednesday, citing its own research. Some 58 percent of seniors think inflation will increase their spending and deplete their retirement savings early.

Previously, the group has called for the SSA to stop relying on the Consumer Price Index for Americans who are aged 62 and older, known as the CPI-E. The SSA uses the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W, to calculate the payment adjustment.

“Years of lackluster COLAs and a looming Social Security insolvency crisis, with its 24 percent automatic benefits cuts, puts a double squeeze on seniors,“ said Senior Citizens League Executive Director Shannon Benton in a statement Wednesday. ”Older Americans already feel like their benefits don’t keep up with inflation, so this risks putting them further and further behind, pushing many into poverty.”

Earlier in the day, the CPI report from the Labor Department rose 0.3 percent last month after gaining 0.2 percent in January. In the 12 months through February, the index advanced 2.4 percent, matching January’s increase, and reflecting last ​year’s high readings dropping out of the calculation. The increase in the CPI was in line with economists’ expectations.

The inflation data released Wednesday covered a period before the United States and Israel launched military strikes against Iran, prompting the country to fire missiles and drones at its oil-producing neighbors and threatening to cut off the crucial Strait of Hormuz. The attacks, which were launched on Feb. 28, have boosted oil and gas prices.

Data from AAA show that the average price for a gallon of regular gasoline increased to $3.58 on Wednesday, or an increase of around 4 cents from Tuesday. The price is up around 35 cents from a week ago and more than 60 cents from a month ago.