Could Inflation Be a Good Thing for Seniors?

Most people wouldn’t say that inflation is a good thing, no matter what the circumstances. While we are all feeling the effects of inflation, it may actually prove to be a good thing for the country’s seniors.

Every year the Social Security Administration reevaluates and adjusts Social Security benefits based on the average inflation rate for the third quarter of the current year, compared with the previous year. That means the new rate of benefits will be dependent upon inflation during July, August and September. Last year it was only a slight rise of 2.3 percent, which ends up being about $25 per month or around $300 per year. This year the amount is expected be much higher.

This expected rise in benefits still doesn’t help our seniors now, when inflation is soaring. Many seniors (and people of all ages and incomes) are having a very hard time making their dollars stretch enough to take care of basic living needs. Seniors will need to hold on and make it work until October of this year, when the new rate is calculated.

How much higher is inflation this year? While the rate for the current month is unknown, we do know that the rate was 4.5 percent in May. Compared with the 2.3 percent raise in benefits last year, it appears that this year will be much higher.

So, inflation could be a good thing for the next three months. Let’s hope our seniors get enough to help them survive the inflation of next year.

Note: for 2009, social security benefits will be raised by 5.8 percent, based on inflation as indicated by the consumer price index.



For information on Social Security Disability, visit the

Social Security Disability Benefits Resource Center