00:00 Josh
Inflation is sticky, we know. The social security cost of living adjustment, COLA, for 2027, flat, Kerry. What do we need to know? Walk us through that.
00:09 Kerry
Yeah, these are early days, but people love to throw these numbers out after whenever that inflation consumer price index has come out, you go, oh my gosh, what’s happening here? How’s it going to look for social security recipients? And so each year you get a bump up in January. Now, the Social Security Administration doesn’t announce that official increase in your benefit, which is a, you know, as we just said, adjusted for inflation until mid-October. But you get an inkling of where things are going when you look each month. And so the months you really want to focus on are that goes into that ultimate calculation are the CPI for July for August and September. So these are preliminary numbers. But what what’s worth noting is that even looking at it being 2.8%, which is what was this year and what this particularly senior citizens league just went came out with their number uh forecasting potentially it would be 2.8% again next year is that it really has a big gap with the reality of the prices that uh seniors are paying right now, everything from, you know, all of these rising costs in terms of healthcare costs and utility costs and food and all these things. And so there’s a bit of a disconnect and and a sort of a sense of alarm
01:34 Kerry
if in fact, it does stay flat. So it’s worth keeping an eye on and hopefully, uh, we’ll see that that everything will be um pretty much in line with the inflation that people seniors are paying. But but even this year there was a lot of consternation that it didn’t even close the gap.
01:54 Josh
If I was a retiree, Kerry, and I was listening to this, I mean, does this, does this mean I should consider doing some things differently just in terms of uh, you know, budgeting or or income planning?
02:08 Kerry
Oh, if you’re currently a retiree, Josh? Um yeah, I think you need to be very, pay close attention to your budget and and lifestyle creep, all of these things that can happen in retirement because, you know, you a lot not everyone relies on social security to be their sole source of income, of course. But but it is a big chunk of a lot of retirees’ uh expected income. So you want to be focused on that fact and also, you know, just be mindful of your budget as best you can. We can’t control uh as individuals what that um COLA bump is going to be each year, but we can control our spending.
