Looking Ahead to 2021 COLA (Or, Lack Thereof)
Nobody really knows what will happen when the CPI-W numbers for the third quarter of 2020 are compared to 2019’s third quarter, but there is mounting speculation that there will likely be a year-over-year decline in living costs (at least as measured by this yardstick). And, of course, a decline here translates to a zero cost-of-living adjustment (COLA) for Social Security beneficiaries for the coming year. It’s happened before (2009, 2010, and 2015).
While it may be too early to project, the dramatic drop in oil prices in evidence so far this year may set the stage for other declines, and the large number of unknowns related to the COVID-19 pandemic may add further weight to the possibility of a drop in prices and therefore a zero COLA. The Motley Fool’s Sean Williams, in a post on their website, takes a look at this issue in some detail, opining that “As of right now, all indications would appear to point toward no COLA in 2021.” Read his article here…