Cost of living adjustments – Don’t bank on them

Maurie Backman provides a brief history of COLAs (cost of living adjustments) in this piece.  Begun in the 1970s, their purpose was to prevent retirees from sliding backwards, as dollars lost value over time due to rising prices.  Backman further points out that Social Security benefits alone were never designed to sustain recipients, though a large number of people rely on them to provide the bulk, if not all, of their income.  What recipients should really do, according to Backman, “is forget about COLAs and take steps to maintain their buying power independently — because even when COLAs do come through, they’re often relatively meaningless.”  Read the full piece here.


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