No Cost Of Living Adjustment For 2016

Since there was no increase in the Consumer Price Index (CPI-W) from the third quarter of 2014 to the third quarter of 2015, Social Security payments will not be increased. This is also known as a Cost of Living Adjustment or a COLA.

The reason for a COLA, is to make sure the recipients of these benefits are not affected by inflation. The Social Security Administration determines the COLA by using the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). If there is no increase there will not be a COLA that year.

For individuals who are applying for SSD or SSI, there is one number that has changed in your favor. If you plan to work while applying for these benefits you may come across the word Substantial Gainful Activity (SGA). This is when someone is working, while applying for these benefits, Social Security sets a limit on not how much you can work, but on how much you can earn. In 2015, the monthly gross amount an individual could make was $1,090.00. In 2016, the amount will go up to $1,130.00 gross per month.

Although no COLA means recipient’s monthly payments will not increase, it also means the cost of living has not increased. This means prices for goods and services have not increased enough to affect change in the cost of living which is good news for everyone.

Source:

Social Security, “2016 Social Security Changes”