No Social Security Cost of Living Adjustment (COLA) in 2016
Bad news for those who receive Social Security retirement and disability benefits: for only the third time in 40 years, there will be no Cost of Living Adjustment (COLA). The only two other years in which there were no COLA increases were 2010 and 2011 – now the government has added 2016 to the list.
This means if you’re receiving some type of Social Security monthly benefit, you will see no increase in your payments next year. This news is expected to affect than 70 million Americans who receive some type of Social Security monthly benefit.
Why the lack of increase next year? COLA calculations are based on a government calculation of inflation. Largely because of lower gas prices, the Consumer Price Index is so low that there will be no COLA for 2016.
This is especially bad news to those with increased Medicare Part B premiums for outpatient medical care are deducted directly from their Social Security payments. Because the COLA is usually enough to cover any rise in premiums, this rise in premium usually does not result in a lowered Social Security amount. However, without the COLA increase to offset the Medicare premium increase in 2016, recipients will likely see a smaller net Social Security check.
If you need help with your Social Security Disability benefits, contact us today at Levine Benjamin.