Social Security: no COLA in 2016
Frederick H. Lowe | 11/4/2015, 4:43 p.m.
The Social Security Administration has announced there will be no automatic cost of living adjustment (COLA) for Social Security beneficiaries next year because there was no increase in inflation as measured by Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) in the third quarter.
“The Social Security Act provides for an automatic increase in Social Security and Supplemental Security Income (SSI) benefits if there is an increase in inflation,” a spokesperson for the Social Security Administration said. “As determined by the Bureau of Labor Statistics, there was no increase in CPI-W from the third quarter of 2014 to the third quarter of 2015. Therefore, under existing law, there can be no COLA in 2016.”
Social Security is a significant source of income for elderly African Americans 65 years old and older, according to the Social Security Administration, which is a based in Baltimore.
In 2013, the average annual Social Security income for black men 65 years old and older was $14,800 and for black women it was $12,540. In 2013 the African-American population was expected to grow from about 13.2% of the nation’s population to 14.1% by 2050.
Nearly 65 million Americans will not receive the COLA increase.
U.S. Representatives Jan Schakowsky (D., Ill.), Doris Matsui (D., Calif.) and Patrick Murphy (D., Fla.) have introduced a resolution to replace the current formula used to calculate the cost-of-living adjustment with CPI-E. The resolution has 70 co-sponsors.
“Social Security is the bedrock of retirement security for millions of Americans,” Schakowsky said. “Two-thirds of seniors rely on their earned Social Security benefits for the majority of their income, 1 in 3 for virtually all of it. The announcement that there will no COLA next year means that they will struggle to pay for increased cost of medical care, food and other basic necessities.”