Social
Security’s annual cost-of-living adjustment (COLA) is an increase in the
benefit amount people receive each month. By law, the monthly Social Security
and SSI federal benefit rate increases when there is a rise in the cost of
living. The government measures changes in the cost of living through the
Department of Labor’s Consumer Price Index (CPI-W).
The
CPI has not risen since the last cost-of-living adjustment in 2015. As a
result, your SSI benefit rate and, for most people, your Social Security
benefit amount will stay the same in 2016.
This
news isn’t necessarily bad. When inflation stays at the same rate, your cost of
living also stays the same. Prices for goods and services, on average, haven’t
increased enough to affect the COLA.
Other
changes that would normally take effect based on changes in the national
average wage index also won’t begin in January 2016. Since there is no COLA,
the statute also prohibits a change in the maximum amount of earnings subject
to the Social Security tax, as well as the retirement earnings test exempt
amounts. These amounts will remain unchanged in 2016. The new fact sheet provides more information on 2016 Social
Security and SSI changes.
For
additional information about the 2016 COLA, go to www.socialsecurity.gov/cola.
For
additional information about changes in the national average wage index, go to www.socialsecurity.gov/OACT/COLA/AWI.html.
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