Archive for February, 2010

As Seniors’ Checks Shrink, $1 COLA Anticipated for 2011

Posted on February 13, 2010. Filed under: Uncategorized |

         Alexandria, VA (February 8, 2010) The year is just getting started, but many seniors are reporting that their Social Security benefits are shrinking, says The Senior Citizens League (TSCL), one of the nation’s largest nonpartisan seniors groups.  In 2010, seniors and the disabled didn’t get an annual cost-of-living adjustment (COLA) because inflation was too low.  But Medicare premiums went up for millions of seniors, leaving them with shrinking Social Security checks. TSCL is conducting an online national survey at www.seniorsleague.org to learn more about the financial impact the situation is having on seniors and the disabled.
         The situation isn’t expected to improve next year, either.  Government economists are saying that the chance of seniors getting a small boost to their benefits in 2011 is almost non-existent.  In the latest budget and economic update, the Congressional Budget Office (CBO) predicted that the annual COLA for 2011 would be one-tenth of one percentage point, (0.1%).  “That would boost monthly Social Security for people with average benefits of about $1,000 by $1,” estimates Daniel O’Connell, Chairman of TSCL.  “Not enough to prevent checks from continuing to shrink again in 2011,” he notes.  TSCL is lobbying for an emergency COLA to protect beneficiaries’ buying power and to help offset climbing Medicare premiums.
         President Obama recently proposed a temporary $250 payment for recipients of Social Security, Supplemental Security Income, and Veterans Benefits in his fiscal year 2011 budget, which starts October 1st, 2010.   While TSCL supports all proposals that would help beneficiaries, “We feel there are better ways to provide this type of payment,” O’Connell says.  “A temporary increase in benefits, does little to protect vulnerable beneficiaries from a long-term loss of income, ” O’Connell notes.
A recent study for TSCL found that two years with no increase in benefits can have a very significant long-term impact on lifetime income.  The study found that without a COLA that actually increases benefits, seniors or the disabled who started with a benefit of $1,000 in 2009 would receive about $17,471 less over a 20-year period due to the loss of the compounding effect of an average annual benefit increase of about 3%.  The amount individuals would lose varies, depending on year of retirement and the monthly benefit they receive.
        TSCL was the first seniors group to call on Congress to provide an emergency COLA in 2009, and strongly supports legislation that would provide an actual increase to benefits, like that provided by H.R. 3557, legislation introduced by U.S. Representative Walter Jones (NC).  The bill calls for an “average” COLA, which would equal about 3%, according to TSCL estimates.  It would boost a $1,000 check by $30 per month-an additional $360 in 2010.  TSCL also supports legislation that would more fairly and accurately base the annual COLA on a “seniors” CPI and guarantee that beneficiaries receive a minimum COLA of 3% every year – the  “Guaranteed 3% COLA for Seniors Act” (H.R. 4193) introduced by U.S. Rep. Eliot Engel (NY).
        “We urge seniors to participate in TSCL’s annual Seniors Survey and let us know if your benefits are shrinking due to rising Medicare premiums,” says O’Connell.  Visit the TSCL website at www.SeniorsLeague.org or send letters to: The Senior Citizens League, 909 N. Washington St. #300, Alexandria, VA 22314.
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With over 1 million supporters, The Senior Citizens League is one of the nation’s largest nonpartisan seniors groups. Located just outside Washington, D.C., its mission is to promote and assist members and supporters, to educate and alert senior citizens about their rights and freedoms as U.S. Citizens, and to protect and defend the benefits senior citizens have earned and paid for. The Senior Citizens League is a proud affiliate of The Retired Enlisted Association. Please visit www.SeniorsLeague.org or call 1-800-333-8725 for more information.
Distributed by The Senior Exchange, Inc.
Serving The Mature American With Timely, Low-Cost, Self-Help Information

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