The Social Security Administration has announced that the Cost of Living Adjustment (COLA) may rise as much as 8% next year. This is to account for rising inflation, which has driven up the cost of living across the country, and which has had a disproportionate impact on many lower income citizens. As a result, recipients of Social Security benefits, including Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) should see a substantial increase in their benefits over the next year.
What is the COLA?
The Cost of Living Adjustment, also known as COLA, is an automatic adjustment applied to Social Security benefits every year, based on increases in the overall cost of living. This is meant to help people on Social Security benefits, including those on SSDI and SSI, to be able to afford rent, groceries, and other necessary expenses. In addition, because the increase is automatic, everyone benefits from it without additional need for paperwork on the part of beneficiaries.
How Does the COLA Get Determined?
The SSA determines the COLA by looking at the CPI-W, the Consumer Price Index for Urban Wage Earners and Clerical Workers. This measurement looks at how much money average workers need to pay for basic expenses, by measuring the change in prices for basic goods and services over time. The greater the change in the CPI-W year over year, the greater the increase in the COLA.
What is the Effect of a Rising COLA?
For Social Security beneficiaries, the benefit of a high COLA is that it means they will receive significantly higher benefits in their Social Security checks in the coming year. However, this is just meant to compensate for rising prices, which are largely blamed on high inflation. As a result, beneficiaries are unlikely to see a significant increase in their standard of living due to the rise in the COLA.
How Does This Affect People With Disabilities?
For people with disabilities, the rising COLA is a good sign that they know their benefits will keep pace with high inflation and rising prices. In particular, anyone on SSDI and SSI can be assured they will not be in worse shape next year due to higher prices. Anyone who is not currently on Social Security disability benefits can also be assured they will receive compensation commensurate to their needs, should they choose to apply for SSDI or SSI.
If you or a loved one need assistance applying for SSDI or SSI benefits, it is important that you seek the guidance of an experienced Social Security Disability benefits lawyer. The lawyers at Sullivan & Kehoe, LLP have over 50 years of combined experience between its attorneys and are available to you or your loved one in obtaining Social Security Disability or Supplemental Security Income benefits. To schedule a consultation with our New York Social Security Disability benefits lawyers, call (631) 823-7155.