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December 2, 2004 09:40 AM

Social Security COLA Increase Looks Puny


Excerpt: SOCIAL Security will save billions of dollars in cost of living increases because of a fortuitous decision in September by the people who compile the nation's inflation numbers.


SOCIAL Security will save billions of dollars in cost of living increases because of a fortuitous decision in September by the people who compile the nation's inflation numbers.
But if you look at the figures that determine how much of a raise retirees get each year, you have to wonder whether the good fortune was helped along by some Washington self-dealing.

Cost of living increases are determined by the average increase in the consumer price index for urban workers during July, August and September compared with the same months of the previous year.

The CPI-U, as it's called, is slightly different from the figure you read in newspaper headlines — but not much.

The CPI-U rose a staggering 0.6 percent in October. That was the month after the three months that count toward the Social Security cost of living adjustment.

In September the CPI-U rose just 0.2 percent, which followed an increase of 0.1 percent in August and a decline of 0.1 percent in July.

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Read all 23 posts in the same category of Retirement:

Bush Says Social Security Plan Would Reassure Markets - Dec 17, 2004
Are You Ready To Retire? - Dec 13, 2004
Last-Minute Retirement Planning - Dec 12, 2004
Small Change Adds Up To Big Savings - Dec 09, 2004
Bush To Borrow To Fix Social Security - Dec 07, 2004
Moving Smoothly Into Retirement - Dec 07, 2004
Get Healthy, Get Wealthy - Dec 06, 2004
Five Books to Retire By - Dec 05, 2004
Tax Policy Promotes Early Retirement - Dec 02, 2004
Fidelity Analyzes Pension Performance - Dec 02, 2004
No More IRA Leniency - Nov 29, 2004
To Yield A Good Retirement, Get Real, And Work It Out - Nov 28, 2004
Social Security Reforms On The Way? - Nov 26, 2004
Some New Ways To Preserve Your Retirement - Nov 23, 2004
Living Trust Offers: How to Make Sure They're Trust-Worthy - Nov 22, 2004
How to Forecast a Lifespan - Nov 21, 2004
Be Happy, And Put Retirement Fears to Rest - Nov 21, 2004
Seven Ways to Stop Saying 'Oops!' - Nov 21, 2004
Retirees Don't Have to Be So Frugal: A Case for Withdrawing Up to 6% a Year - Nov 17, 2004
How to Avoid Living Like a Poor Student at Age 70 - Nov 09, 2004
What Social Security Might Look Like - Nov 09, 2004
Are You Retirement Ready -- Or Not? - Nov 03, 2004