Garcia's retirement savings have also taken a hit from the falling stock market. And then a piece of chicken that I've bought when it's on sale." "Now I'm eating canned tuna," Garcia said with a rueful laugh. Miriam Garcia, a retiree in Florida, has cut back on buying fresh salmon, even though she says it's good for you and "better than taking pills." Grocery prices jumped 13% over the last 12 months. Retirees, who don't have to commute every day, are typically less sensitive to rising gasoline prices than other consumers, but they do have to buy food. "This is one way we can be sure that they can afford their housing costs and their food costs and other important necessities in their lives," said Kathleen Romig, director of Social Security and disability policy at the Center on Budget and Policy Priorities. About 1 in 5 seniors rely on Social Security for at least 90% of their income, so adjusting payments to keep pace with inflation is critical. The average retiree currently receives around $1625 a month.
Social Security benefits still aren't all that generous. Whereas a lot of people in the working world, it depends on how the business is doing whether they get a raise or not." "People on Social Security always get referred to as being on a fixed income, but they're the only group in the country that is not on a fixed income," says Bill List, a retiree in Lititz, Pa. The jump is significantly more than the typical worker is getting. More than 65 million people will see the increased payments, including disabled workers and survivors as well as retirees. "Wow!" Christophersen exclaimed when told about the expected boost to her benefits. That will boost the average benefit by $141 a month. Now though, with prices climbing rapidly, retirees can look forward to the biggest cost-of-living adjustment, or COLA, in four decades: 8.7%. Most years, when prices are stable, it's a trivial adjustment. The annual increase is automatic - pegged to inflation the previous July, August and September. Luckily, Social Security benefits will also be going up substantially in January. "I just got my rent increase notice Tuesday," she said, noting that her lease expires in December. She's worried that before long she'll have to downsize. Rent on a two-bedroom apartment in a Tulsa senior community gobbles up much of Christophersen's monthly income.
For families who heat with natural gas, the increase could be 28%. On Tuesday, the Energy Department warned that electric heating bills will likely be 10% higher this winter than last. That's down slightly from the previous month but prices remain stubbornly high. And I've heard rumors that it's going up again, and it was like, 'Good grief!'"Ĭonsumer prices rose 8.2% for the 12 months ending in September, the Labor Department said Thursday. "I'm back to hanging up my clothes in my apartment. Tulsa retiree Lynn Christophersen relies almost entirely on Social Security to pay her bills, whether it's covering the rising price of gasoline or another increase in the cost of electricity.
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