Although the COLA is often good news for Social Security beneficiaries in the United States, sometimes it is not as good news as it may seem. Benefit cuts are more prevalent than ever and not all cuts are so obvious.
In the case of the 2024 COLA we are actually looking at a fairly large cut. The difference between the 2023 COLA and what is likely to be the 2024 COLA is huge. If the forecasts end up being true, the Social Security COLA in 2024 will be around 3%.
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If we compare this Cost of Living Adjustment with that of 2023 we find a remarkable difference. This year’s 8.7% is more than 5% higher than next year. Although the figures are neither official nor exact, it is very likely that we will find ourselves with this final amount.
And that is why many United States citizens who live on Social Security benefits alone as a source of income have begun to panic. If inflation continues to increase and the COLA does not catch up, they will eventually lose purchasing power.
HOW DO WE AVOID FINANCIAL PROBLEMS BY COLLECTING ONLY SOCIAL SECURITY IN 2024?
The first thing to keep in mind is that this fear is completely normal. When it comes time to get the COLA we will see that the cut is huge. For that reason thousands of Americans will not have enough money to deal with inflation.
In the case of collecting Social Security alone we have to watch out our economy more than ever. On the one hand, we must eliminate all superfluous and unnecessary expenses. On the other hand, we should try to save as much money as we can.
Likewise, if we have any source of extra income it will also be welcome. So we must look for it. What we do have to keep in mind is that we must prepare for the worst situation, since the COLA will not be enough for many retirees who collect Social Security.