Without a COLA that keeps up with costs, seniors are at risk of not having sufficient income for retirement. To put it in perspective, for every $100 worth of expenses seniors could afford in 2000, they can afford just $66 today.
Washington, DC (PRWEB) May 15, 2012
Seniors have lost more than one-third of their buying power since 2000, according to the Annual Survey of Senior Costs, released today by The Senior Citizens League (TSCL). TSCL is one of the nation’s largest nonpartisan seniors advocacy groups.
In most years, seniors receive a small increase in their Social Security checks, intended to help them keep up with rising costs. But since 2000, the Social Security Cost of Living Adjustment (COLA) has increased benefits just 36 percent while typical senior expenses have jumped 82 percent, more than twice as fast.
After two unprecedented years without receiving a COLA, seniors received a 3.6% COLA this year. The Social Security Trustees recently forecast to receive a low 1.8% COLA next year. To view a chart detailing the change in costs of goods commonly purchased by seniors between 2000 and 2012, visit http://www.SeniorsLeague.org or see the attached chart.
“Without a COLA that keeps up with costs, seniors are at risk of not having sufficient income for retirement,” said Larry Hyland, chairman of The Senior Citizens League. “To put it in perspective, for every $100 worth of expenses seniors could afford in 2000, they can afford just $66 today.”
A senior with the average monthly Social Security benefit in 2000 received $816 per month, a figure that rose to $1,110.90 by 2012. However, that senior would require a Social Security monthly benefit of $1,485.00 per month in 2012 just to maintain his or her 2000 lifestyle.
The study examined the increase in costs of 32 key items between 2000 and January 2012. The items were chosen because they are typical of the costs seniors must bear. Of the 32 costs analyzed, 21 exceeded the COLA. The selected items represent eight categories, weighted by approximate expenditure.
A majority of the more than 53 million senior and disabled Americans and over who receive a Social Security check depend on it for at least 50 percent of their total income, and one in three beneficiaries rely on it for 90 percent or more of their total income.
To help protect buying power, The Senior Citizens League is lobbying for legislation that would use a “senior” CPI to calculate the annual COLA. The government currently calculates the COLA based on the CPI for Urban Wage Earners and Clerical Workers (CPI-W), a slow-rising index that tracks the spending habits of younger workers who don’t spend as much of their income on health expenditures.
However, the government does track the spending patterns of older Americans, and has done so since 1983 using the experimental CPI for Elderly Consumers, or CPI-E. A retiree with average benefits would have received $14,854 more over the past 28 years using the CPI-E. Because the COLA compounds over time that individuals benefit would be more than $84 a month higher today using the CPI-E.
With over 1 million supporters, The Senior Citizens League is one of the nation’s largest nonpartisan seniors groups. Its mission is to promote and assist members and supporters, to educate and alert senior citizens about their rights and freedoms as U.S. Citizens, and to protect and defend the benefits senior citizens have earned and paid for. The Senior Citizens League is a proud affiliate of The Retired Enlisted Association. Visit http://www.SeniorsLeague.org for more information.
Shannon Benton, Executive Director, 1-800-333-TSCL (8725) sbenton(at)tsclhq(dot)org
Mary Johnson, Social Security policy analyst, 540-832-5513, newslettersdirect(at)hughes(dot)net
ALSO AVAILABLE TO JOURNALISTS: STUDY METHODOLOGY AND INTERVIEWS