No Social Security Pay Increase for Second Straight Year

As reported previously on AdvisorOne.com, the rise in prices in some areas of the CPI have been offset by drops in other areas. This makes it difficult on seniors who often must devote far more of their income to the areas that rise than to those that fall. The absence of a COLA for the second year in a row is so unpopular that President Barack Obama and the Democrats are pushing for a one-time $250 stimulus payment for seniors on Social Security. Obama had advocated such a payment in the fall of 2009, but Republicans and a dozen Democrats blocked the measure. House Speaker Nancy Pelosi is promising to schedule a vote after the November 2 elections.

Other changes that are triggered by a rise in the CPI will not occur, such as a change in the maximum amount of earnings subject to the Social Security tax and the retirement earnings test exempt amounts. More information on the COLA is available at the SSA website, as is more information on Social Security and Supplemental Security Income changes for 2011.