Retirees are feeling the impact as Social Security checks shrunk last year: report

America’s senior citizens and retirement community may have been feeling additional financial stress in recent months as their Social Security payments took a big hit last year.

According to the nonpartisan Senior Citizens League, there was a sharp increase in the cost of living in 2022, and a decrease in inflation-adjusted payments given to Social Security recipients in the same year. This resulted in a 46% difference in the monthly benefit checks received by 70 million Americans.

The organization reported that Social Security recipients received a 5.9% cost-of-living-adjustment (COLA) last January, with the average benefit check rising to $92.30, from $1,564 in 2021 to $1,656.30 for 2022.

The league pointed out, however, that the 5.9% inflation adjustment was an average of 46% less than the actual inflation figure each month.

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US Treasury logo

FILE – Blank Social Security checks are run through a printer at the US Treasury Printing Facility on February 11, 2005 in Philadelphia, Pennsylvania. (William Thomas Cain/Getty Images/Getty Images)

This calculated discrepancy resulted in the average Social Security benefit check falling by more than $42 per month and by more than $508 for 2022, according to their report.

“While Social Security recipients are looking forward to an 8.7% increase in Social Security benefits in January, inflation has taken its toll on retiree budgets in 2022,” the league said in a statement. “Many retirees have been forced to spend through savings far faster than planned and those without savings have turned in high numbers to food pantries and low-income assistance programs.”

The inflation-adjusted rate was calculated using data for 2021 as measured by the Consumer Price Index.

The annual inflation rate for 2021 was 7%, but adjustments for Social Security benefits are calculated based on changes in the third quarter reporting of the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) only .

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The third quarter runs from July 1 to September 30.

In the third quarter of 2021, the CPI-W is projected to increase by 5.9%. The rate jumped to 7.4% by the end of the fourth quarter, leaving the number of seniors short before the start of 2022.

Going forward to 2023, these rates have been adjusted again.

a social security card

FILE – In this photo illustration, a Social Security card sits alongside a check from the US Treasury on October 14, 2021 in Washington, DC (Kevin Diesch/Getty Images/Getty Images)

Through January 2023, Social Security benefits are set to increase by 8.7%, or about $140, increasing the average check to nearly $1,800.

This increase was again calculated through third quarter inflation rates: inflation was 7.1% by November, falling from a surprisingly high 9.8% in June.

Federal agencies are predicting that 2022 will end with an annual inflation rate of between 7% and 8.01%.

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a couple walking

An elderly couple walks down a street on February 4, 2020 in Alhambra, California. (Frederick J. Brown/AFP via Getty Images/Getty Images)

While seniors are looking forward to an increase in Social Security payments in 2023, many are still struggling with the gap between 2022 inflation and their Social Security payments.

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The Senior Citizens League reported that 33% of seniors applied for food stamps or visited a food pantry this year, compared to 22% last year, and 17% dealt with heating costs, compared to 10% last year. applied for assistance. for a recent study.

The Associated Press contributed to this report.

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