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Retirement Planning > Spending in Retirement > Income Planning

Inflation Is Burning Through Social Security COLA for 2022: Survey

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What You Need to Know

  • Retirees got a 5.9% raise for 2022 as inflation has topped 7%.
  • The average Social Security benefit rose $92 a month, while 73% of older adults surveyed said their costs had risen $96 a month or more.

Seniors are worse off today despite the biggest cost-of-living adjustment to Social Security benefits in the past 40 years, according to a new survey by The Senior Citizens League, an advocacy group for older adults.

Despite a COLA of 5.9% for 2022, raising average Social Security benefits by $92 per month, 73% of survey respondents who receive Social Security said their monthly expenditures increased by at least $96 per month in 2021, according to the group. Further, 48% stated their monthly expenditures had increased by more than $144.

The yearly adjustment is determined by average inflation, as measured by the Consumer Price Index, during the third quarter of the previous year. However, “inflation has burned through consumer buying power” since the 2022 COLA was set, said Mary Johnson, a Social Security and Medicare policy analyst for The Senior Citizens League, in a statement.

TSCL calculated that the COLA based on the latest CPI data would be 7.6%.

The increase in inflation since 2021 means there is now an unusually high benefit shortfall of almost 2%, Johnson says. She points out that the CPI-W in December 2021 was up 7.8%, already higher than the COLA to be received in January.

The loss of buying power due to the rise in inflation is dramatic, Johnson points out. The 1.9 percentage-point shortfall between the 2022 COLA and current inflation rate means about $30 per month less for retirees.

Gas, housing and food were the largest contributors to the latest CPI data, reported March 10, when the Bureau of Labor Statistics announced a 0.8% increase in February and a 7.9% increase over the last 12 months.

Even if the Federal Reserve begins to raise rates in March as expected, Johnson sees the effects of inflation persisting.

“This is especially the case since gas and other oil products are likely to remain high,” she said in the statement. “Older consumers are looking for relief from the non-stop price hikes. Retired and disabled Social Security beneficiaries know that a COLA that does not keep up with rising costs forces them to spend more from savings, can force them to borrow, and leads to a loss of Social Security income over the course of a retirement that is never remedied.”


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