What Can Go Wrong
Relying too heavily on early predictions can lead to financial missteps. While a 3.8 percent forecast sounds promising, several factors can disrupt your expectations.
First, economic conditions change rapidly. If the Federal Reserve successfully cools the economy and inflation drops sharply during the summer months, the third-quarter data will come in lower than current projections. The final COLA announced in October could easily land closer to 2.5 or 3.0 percent. If you budget based on the higher prediction, you will face a shortfall come January.
Second, retirees frequently overestimate their net income by ignoring state taxes. While the federal government taxes Social Security based on provisional income, roughly ten states still tax Social Security benefits to varying degrees. Kiplinger regularly updates its state-by-state tax guides, which provide essential reading if you plan to relocate. Failing to factor state tax liabilities into your budget will leave you with less disposable income than you planned.
Finally, underestimating personal healthcare inflation remains a critical danger. Even if the COLA is robust, a new diagnosis requiring expensive tier-3 or tier-4 prescription drugs can decimate your monthly budget. You must plan for out-of-pocket medical maximums, not just baseline premiums.
3.8% COLA is a disgrace to those on SSI.
You get a whopping extra $79 and medicare increases its monthly requirement.
After that the $79 is shrunk down to if your lucky $10,.
Quit wasting the money we put in from our salaries. and increase the COLA so we can keep up with inflation and not give it to Illegals…
Depressed and frustrated senior citizen…………..
I’ll get about $154 more
COLA is so broken. The cost of gas has made almost a 20% increase and cost of food has nearly 30% increase on some items. 3% is not even a scratch on the surface. Its hard enough to get SSI but to work your whole life just to struggle because the government can’t do basic math is getting really old. COLA is suppose to reflect the Cost of Living. Ao if cost of living makes a 20% increase that year the SSI and VA Disability benefits should follow suit. Quit punishing the people who the government has lied to the longest.
Yeah, we appreciate everything we get, but this still is not enough for the older people
The only good thing I have to say is I’m more and more grateful for the Blue Cross- Blue Shield insurance that, as a former VA employee, I carried over into retirement. Comparing BCBS with Medicare plan B, the latter is a ripoff.
3.8 per cent of nothing is still nothing
Right on .They don’t get social security and the right wing lies about it to keep us divided by their ignorant base that don’t know any better since they are told to stay stupid and not research or think for themselves
So we get a raise in social security but then Medicare raises its prices so SS is a very little increase. How about we make Congress paypack the monies they STOLE from Social Security and left WORTHLESS IOU’s in its place? Plus interest, it might make Social Security solvent. And then ahow about Congress has to pay into Social Security the way other people HAVE TO. How about any time they make a new rule, they have to follow it also and not be exempt! I’d be for all of that!
So we get a raise but Medicare immediately raises what they pull out. Your ‘raise’ is drastically reduced. How about we do 2 things: Make Congress pay back (with interest) the Worthless IOU’s they left when they Stole funds from Social Security. And make Congress pay into Social Security the way the people who work have to. Just a thought.
You get a bump in social security and Medicare immediately raises you costs so how much do you really realize in the SS gain? If they made Congress pay back all the WORTHLESS IOU’s they left when they stole monies from Social Security, it would put social security on solid financial ground. But they won’t pay it back yet keep raising their (Congress’) salaries ! And how about if Congress had to pay into social security instead of exempting themselves from it?