If you are collecting Social Security payments — or plan to in the near future — here’s an improbable thing you should wish for: higher gasoline prices.
Last month, in an article published by the New York Post, higher pump prices were shown to be advantageous for Social Security beneficiaries. Here’s how: higher gas prices during August and September will boost the 2019 Cost-of-Living Adjustment (COLA).
Annual COLAs are very important to Social Security recipients
Social Security is a program that, according to the Social Security Administration (SSA), provides a guaranteed benefit to 62.2 million people each month, as of March 2018. Almost 69% of these recipients (42.8 million) are retired workers, and of them, 62% lean on Social Security to account for at least half of their monthly income. In other words, it's a vital program that many would struggle to live without.
Since most retired workers rely on Social Security for a large portion of their income, the SSA's announcement in mid-October regarding the following year's COLA is a highly anticipated event. COLA is the "raise" that beneficiaries receive each year, and Social Security recipients want to know how much extra they'll be receiving each month the following year compared to the current year.
The Social Security Act specifies a formula for determining each COLA. According to the formula, COLAs are based on increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
The CPI-W considers eight major spending categories:
The price of gas can have a profound impact on several of these categories. Gasoline is integral to the transportation category, and played a key role in pushing Social Security’s COLA up 2% in 2018. Last year, hurricanes Harvey and Irma wound up shutting down refineries in the southern U.S. and Gulf of Mexico, straining gasoline supply and substantially pushing up gasoline prices in August and September—two of the three months that factor into the annual COLA calculation.
So, if you’re a Social Security beneficiary, root for higher gas prices this month. Just don’t do it too loudly!
The Law Firm of Hoskins, Turco, Lloyd & Lloyd is here to help you decide when to apply for Social Security and/or how to navigate the application process. Our experienced Social Security attorneys provide our clients with one-on-one, personalized representation to ensure you receive the benefits you deserve. If you have been denied Social Security benefits or believe you have been wrongfully terminated by the SSA, contact us today for a free consultation. Our highly skilled and successful team of legal professionals will improve your chances of winning disability benefits.
Don’t fight this stressful situation on your own. Filing for Social Security benefits is a time-sensitive process, so do not delay in calling us today at 866-460-1990. And if you've been denied SSD, we can help file your appeal and get you approved. Call today.