Samples & After Press Information
Our July 2017 Senior Beacon
SS Benefits Lose 30% Buying
Power Since 2000!!
by Shannon Benton-TSCL
DC) – Social Security beneficiaries have lost nearly one –
third of their buying power since 2000, according to the 2017
Social Security Loss of Buying Power Study released today by The
Senior Citizens League (TSCL). "The findings represent a big
loss of 7 percent in buying power, from 23% in 2016 to 30% over
the past 12 months. This occurred as inflation has begun to climb,
but people receiving Social Security received an annual cost - of
- living adjustment (COLA) of just 0.3 percent for 2017,"
says TSCL’s Social Security policy analyst and the study’s
author, Mary Johnson. Housing and medical costs —particularly
for prescription drug expenses — were among the most rapidly -
rising spending categories over the past year.
The study’s findings illustrate the impact on
the buying power of Social Security benefits when the economy goes
from a period of extremely low inflation to more typical rates of
inflation. The last time there was a loss in buying power this big
was in 2011, another year similar to 2017, when there was no COLA,
but inflation spiked. The following year in 2012 Social Security
benefits increased by 3.6 percent. Based on consumer price index
(CPI) data through April of this year, Johnson estimates that the
COLA for 2018 may indeed be significantly higher than in recent
years —around 2.1 percent — but that number could change since
there are still several months to go before all the data is in.
More than 840 respondents to TSCL’s annual
senior survey, conducted from January through March of this year,
confirm that monthly household expenses made steep increases over
the past year. The majority, 67%, indicated their monthly expenses
went up by more than $79. "With today’s Social Security
benefit averaging $1,320 per month, that’s an unsustainable
level of rising spending when there’s just a 0.3 percent benefit
increase to match," Johnson says.
Social Security beneficiaries receive a small
automatic increase in their Social Security checks most years,
intended to help their benefits keep up with rising costs. But
since 2000, COLAs increased benefits a total of just 43 percent
while typical senior expenses have jumped 86 percent. "When
costs climb more rapidly than benefits, retirees must spend down
retirement savings more quickly than expected, and those without
savings or other retirement income are either going into debt, or
going without," Johnson says.
Top Ten Fastest Growing Senior Costs Since 2000
1. Medicare Part B
monthly premium. 2000 - $45.50; 2017 - $134.00; Increase 195%.
2. Prescription drugs
Annual average out-of-pocket. 2000 - $1,102.00; 2017 - $3,132.00;
3. Homeowner’s insurance
national average annual premium. 2000 - $508.00; 2017 - $1,292.00.
4. Real estate tax
annual, 2000 - $690.00; 2017 - $1,701.50; Increase 147%.
5. Propane gas per gallon, 2000
- $1.01; 2017 - $2.39; Increase 137%.
6. Heating oil,
2000 - $1.15; 2017 - $2.63. Increase - 130%.
7. Medigap supplement average monthly premium
2000 - $119.00; 2017 - $264.45. Increase 122%.
8. Pet care services including veterinary.
2000 - 109.300*; 2017 -232.317*; Increase 113%.
9. Total medical out-of-pocket expenses
national average people age 65 and up. 2000
2017 - $12,125.00. Increase 97%.
10. Oranges per pound.
2017 - $1.19. Increase 95%.
* Where no average prices are available,
numeric values from the U.S. Bureau of Labor Statistics CPI-U are
The survey found that a person having the
national average Social Security benefit in 2000 — $816 per
month — would have $1,169.80 per month by 2016. However, because
retiree costs are rising at a substantially faster pace than the
COLA, that individual would require a Social Security benefit of
$1,517.80 per month in 2017 just to maintain his or her 2000 level
of buying power.
The study examined the increase in costs of 39
key items between 2000 and January 2017. The items were chosen
because they are typical of the costs that most Social Security
recipients must bear. Of the 39 costs analyzed, 26 exceeded the
percentage of increase in the COLA over the same period. The
selected items represent eight categories, weighted by approximate
expenditure. The study used the same weightings that the
government uses in calculating the Consumer Price Index for the
Elderly. "This study illustrates why Congress should enact
legislation to provide a more fair and adequate COLA,"
Johnson says. "To put it in perspective, for every $100 worth
of expenses seniors could afford in 2000, they can afford just $70
today," Johnson adds.
A majority of the 57 million senior and
disabled Americans who receive Social Security depend on it for at
least 50 percent of their total income, and one – third of all
beneficiaries rely on it for 90 percent or more of their income.
To help protect the buying power of benefits, TSCL supports
legislation that would base COLAs on the Consumer Price Index for
the Elderly (CPI-E). To learn more, visit www.SeniorsLeague.org.
With 1.2 million supporters, The Senior Citizens League is one
of the nation’s largest nonpartisan seniors groups. 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. Visit
www.SeniorsLeague.org for more information.