Social Security needs new formula for COLA
As a Social Security retirement benefits recipient, I recently received the following statement from the Social Security Administration explaining the reason why recipients will not receive COLA next year. “We review Social Security benefits each year to make sure they keep up with the cost of living. The law does not permit an increase in benefits when there is no increase in the cost of living. So your benefit will stay the same in 2016. There was no increase in the cost of living during the past year based on the Consumer Price Index published by the Department of Labor.”
While I am fully aware of this formula, what puzzles me is that while SS recipients won’t see a COLA in 2016, for those of us receiving Medicare, our premiums went up. In my case, $17.80 more monthly. This premium will be deducted from my benefit, leaving a minus, not a figure reflecting the same amount in benefit. In my opinion, the formula used by the government to calculate COLA needs to be revised and change accordingly.