Social Security Administration – COLA for Next Year Lowest in Years

Social Security set to announce annual COLA; benefit increase to be among lowest in years – Washington Post

The cost-of-living adjustment, or COLA, is based on a government measure of inflation that is being released Wednesday.

Preliminary figures suggest a raise of roughly 1.5 percent, which would make it among the smallest since automatic adjustments were adopted in 1975. The increase will be small because consumer prices, as measured by the government, haven’t gone up much in the past year.


Since 1975, annual Social Security raises have averaged 4.1 percent. Only six times have they been less than 2 percent, including three of the past five years. This year’s increase was 1.7 percent. There was no COLA in 2010 or 2011 because inflation was too low.

By law, the cost-of-living adjustment is based on the consumer price index for urban wage earners and clerical workers, a broad measure of consumer prices generated by the Bureau of Labor Statistics. It measures price changes for food, housing, clothing, transportation, energy, medical care, recreation and education.

The COLA is calculated by comparing consumer prices in July, August and September each year to prices in the same three months from the previous year. If prices go up over the course of the year, benefits go up, starting with payments delivered in January.

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