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Social Security: Could higher China tariffs mean bigger COLA?
Social Security’s Cost of Living Adjustment (COLA) is meant to keep benefits for seniors who are dependent on the program at least on a par with inflation. COLA is determined each year by changes to the Consumer Price Index which measures inflation, and if the CPI index for the 3rd quarter of the current year is more than the same period last year, Social Security recipients will see an increase in their benefit amount. So, concludes this Yahoo! Finance article by Motley Fool’s Sean Williams, higher tariffs on goods from China or Mexico could actually result in a higher than now projected COLA because such tariffs would result in a bigger change to the CPI. But of course, higher tariffs on Chinese goods would also mean higher inflation, making it more difficult for seniors to stretch their Social Security dollars. Which is why, the article opines, a higher COLA isn’t necessarily a cause for celebration. Click here to read the Yahoo! Finance article by Sean Williams.