Closure delays announcement of Social Security cost of living

WASHINGTON (AP) — Current government shutdown delays annual report announcement Social security adjustment to the cost of living for tens of millions of beneficiaries.

Initially scheduled for Wednesday, the Social Security COLA announcement for 2024 will now take place on October 24. It is timed based on the September consumer price index, which has not yet been released.

The agency adjusts its benefits each year based on inflation. The postponement of the announcement is most recent example about how the government shutdown, entering its third week and with little progress toward a resolution, has made it harder for people to plan their finances.

Senior Citizens League and AARP Projections anticipate a COLA increase of approximately 2.7%. About 70.6 million People, including retirees, disabled people and children, receive social security benefits.

Social Security Administration beneficiaries have expressed concern that next year’s increase won’t be enough to counter rising costs.

Sue Conard, a 75-year-old retired nurse from La Crosse, Wisconsin, and SSA beneficiary, recently visited the U.S. Capitol with other retired members of the American Federation of State, County and Municipal Employees to push for significant progress toward securing health care protections to end the shutdown, as well as changes to Social Security benefits.

She said she wants lawmakers to change the COLA calculation because the standard CPI metric, which includes a basket of consumer goods and services, doesn’t take into account many costs typical of older Americans.

“The question of how the COLA is determined is flat-out wrong, because health care is not factored into the CPI,” Conard said, speaking outside the Longworth House office building.

Some lawmakers have proposed legislation that would require SSA to use a different index, called the Consumer Price Index for Seniors (CPI-E), to calculate cost-of-living increases that measure price changes based on seniors’ spending habits in areas such as health care, food and medicine.

A group of Democratic lawmakers have proposed legislation to replace the CPI calculation for COLA benefits with the CPI-E. Last session, Sen. Bob Casey, Democrat of Pennsylvania, proposed legislation that would change the COLA calculation, but it never made it to the Senate Finance Committee.

Myechia Minter-Jordan, CEO of AARP, said the COLA “is not just a source of income – it is a lifeline of independence and dignity for tens of millions of older Americans.” But even with an adjusted COLA, a majority of Americans still struggle to cover basic expenses, she said.

Vanessa Fields, a 70-year-old former social worker and AFSCME member from Philadelphia, said she pays about $1,000 a month for groceries, more than in previous years. The COLA is failing to keep up with rising costs, she said, “and we’re going to be in bad shape if lawmakers don’t act.”

The agency is expected to begin informing recipients of their new benefit amounts starting in early December. A Social Security spokesperson who spoke on condition of anonymity to preview the COLA said retirement and Supplemental Security Income benefits would be adjusted starting Jan. 1, 2026, with no delay despite the government’s current appropriations shortage.

The COLA’s late announcement comes as the national social insurance system faces a serious financial shortfall in the coming years and the agency has seen significant staff reductions.

The Annual Report of the Social Security and Medicare Administrators released in June said the program’s trust fund will not be able to pay full benefits starting in 2034, instead of last year’s estimate of 2035. If the trust fund is exhausted, the government will only be able to pay 81% of planned benefits, the report said.

Additionally, the agency laid off at least 7,000 people from its 60,000-strong workforce earlier this year, putting pressure on remaining workers to process claims and meet the demands of a growing number of beneficiaries.