COLA Increase 2024: The 2024 COLA increase will have a significant impact on how much money many Americans receive in the new year.
The Cost-of-Living Adjustment (COLA) is a financial mechanism used in the United States to increase benefits in accordance with inflation.
What does Cost-of-Living Adjustment (COLA) mean in the United States?
Investopedia explains, “COLA is an increase made to Social Security and Supplemental Security Income (SSI) to offset the inflationary effects of rising prices in the economy.”
“COLAs are usually equal to the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for a given period.
“The Consumer Price Index (CPI) represents the average prices of a basket of goods and is used to measure inflation.”
In 2023, the cost-of-living adjustment (COLA) increase was 8.7 percent, the highest year-over-year increase in forty years.
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COLA Increase 2024: What is the anticipated CPI increase for 2024?
Regarding the 2024 cost-of-living adjustment (COLA) increase, it is too early to say for certain, but it should be significantly less than the 8.7 percent increase observed in 2023.
In fact, the percentage increase could be less than half of what it was in 2023 due to the significant decline in inflation.
The Senior Citizens League, a nonpartisan advocacy organisation, projects that the COLA increase in 2024 will be approximately 3.0 percent.
How will the 2024 COLA increase impact me?
If the CPI increases by just 3.0 percent between 2023 and 2024, Social Security beneficiaries will see their payments increase by 3.0 percent.
For instance, if you receive $10,000 in Social Security benefits in 2023, that quantity would increase to $10,300 in 2024.
While this is still an increase, it is significantly less than what many claimants saw at the beginning of 2023.
