Finally, there is cause for celebration for Social Security beneficiaries: on Wednesday, the projection for the rise in benefits for the following year was slightly raised, despite the government’s claim that inflation continued to decline in June.
After peaking at 9.1% in June 2022, annual inflation dropped to 3% in June from 4% in May. It also represented the lowest rise since March 2021, primarily as a result of a 16.7% drop in electricity prices, despite a rise of 0.6% in monthly energy. Despite being down from May’s 6.7% annual rise, food prices rose by 5.7%. Rents, which are included in a shelter, increased 7.8% over the previous year, which remains less than May’s 8% increase.
Since individuals are recovering their ability to spend, lower inflation is typically appreciated. However, Social Security claimants, who have become used to observing their prospective cost-of-living adjustment (COLA) decrease with lower inflation, received an added surprise that was unusual. The Senior Citizens League, a nonprofit organization for seniors, predicts that COLA will be 3% the following year.