Growth of Retiree Costs Versus Social Security Benefits 2000-2015
Chart of the Week for November 6, 2015 - November 12, 2015
Inflation is one of the many factors that people planning for retirement should consider. Its compounding effect over time can erode retiree's standard of living in retirement years. Since inflation does not impact all products and services evenly, people planning for retirement need to factor on inflation for the products that they purchase.
Recently, the Social Security Administration announced that for the third time in six years, there will be no cost of living adjustment increase for Social Security recipients, as the average inflation rate continues to be low. The chart above compares the growth of Social Security benefits to the inflation of some expenses incurred by retirees for the time period 2000-2015. While benefits grew by 43% during the period, expenses such as Medicare Part B rose 131% and Heating Oil rose 159%. The inflation of many products and services grew by multiples of the benefits growth rate. This trend reinforces the thought that Social Security should only be one part of your retirement strategy if you are seeking to maintain your standard of living in retirement.
Posted by: sarah_oz@yahoo.com
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