Retirees receiving Social Security benefits will see a cost-of-living increase for 2020. On October 10, 2019, the Social Security Administration announced a 1.6% boost for next year. This is lower than the 2.8% increase that went into effect for 2019.
Each year, the Social Security Administration assesses whether there should be an adjustment to benefits so that their purchasing power keeps up with inflation. The agency uses the Consumer Price Index for Urban Wage Earners and Clerical Workers, CPI-W, from the Bureau of Labor Statistics. Increases are thus linked to how much inflation the economy is exhibiting.
Historically, increases are not to be taken for granted. In fact, the cost-of-living adjustment was zero in some recent years like 2010, 2011, and 2016. The 2.8% increase for 2019 was the largest Social Security retirement benefit boost in seven years. Social Security cost-of-living adjustments have averaged 1.4% in the past decade.
