Chasing Prices: Will Social Security COLA Keep Up?
What if the milk in your refrigerator doubled in price while your income stood perfectly still? That simple, unsettling question captures the heart of every conversation about Social Security and inflation . Each January, more than seventy million Americans receive a modest bump in their benefit checks, courtesy of the Cost‑of‑Living Adjustment, or COLA. But does that yearly raise truly keep pace with the shifting price tags we meet at grocery stores, pharmacies, and gas pumps? Let’s follow the breadcrumbs of curiosity and find out. Peeking Inside the COLA Formula Have you ever wondered who decides how large your COLA will be? The answer hides in the monthly reports of the Consumer Price Index for Urban Wage Earners and Clerical Workers—mercifully abbreviated CPI‑W. Picture government statisticians in economic detective mode, tracking the cost of everything from breakfast cereal to bus tickets. Each autumn, they average CPI‑W figures for July, August, and September, then compare that t...