SURVEY SAYS: Should There Be a Social Security COLA Adjustment?

October 14, 2010 ( - Published reports indicate that Social Security recipients won’t get an annual cost-of-living adjustment (COLA) for 2010 

The reason for that is relatively straightforward; because there has been no cost increase in the measures that the COLA is supposed to adjust for.   

Of course, you may remember that there was a similar situation a year ago (see No Raise for Social Security Recipients in 2010)  – the first time since 1975 that there was no annual COLA for Social Security.  You may also remember that the cost-adjustment trends were actually negative last year (though there is no provision for a negative COLA in Social Security).   


Last year there was talk (and legislation introduced) to provide a $250 check to seniors to mute the impact, and there’s talk of doing so again this year.  This week I asked readers what, if anything, they thought should be done to address the absence of a Social Security COLA?   


On this question, there really wasn’t much disagreement; a full two-thirds (66.7%) said that since there was no increase in the cost of living, there should be no cost of living adjustment.  

A mere 15.6% said that some adjustment seemed appropriate, whatever the formula, while 3.3% opted for “what could a little (more) stimulus hurt?” 

The rest went with “other”, though to my eyes, anyway, most were comfortable with an adjustment, subject to certain “conditions.”  Here’s a sampling: 


Don't raise their Health Insurance premiums 

Cut benefits as prices have fallen. No reason they should get real increases when workers are unemployed and wages haven't kept up. 

The adjustment might equal the cost increase planned for Medicare coverages. 

Congress can take back their pay raise and give that to SS COLA 

An adjustment to the lowest paid recipients is in order, since that money will be spent.  Those receiving larger checks should just tough it out for one more year like the rest of us wage earners. 

There may not be an adjustment needed due to the components they are looking at but they must not be considering the cost of health insurance.  Last year, Mom's insurance went up and I am sure this year's insurance will go up.  There's a flaw if they are not considering the average increase to Medicare Supplements or other insurance programs for seniors. 

Devise a COLA that reflects the costs incurred by seniors more accurately. 

Remind them they are lucky 10% of them have not lost their pay check like the working population paying with current dollars the Tab for Social Security. Social Security is a pay as you go system -- if there are less working there is less to distribute. 

Start privatizing Social Security! 

Across the board cut in government workers' salaries starting with Pelosi and reduce all government retirement plans.  And maybe some of the stimulus money should be put towards SS COLA  instead of some of the ridiculous projects that were targeted. 

If there's no increase in Social Security, then DO NOT increase Medicare. 

Just have it reflect raises for Congress & Senate - if no increase for Social Security - no raises for Congress & Senate.  Watch how fast things change... 

If stimulus money were used, it should definitely come out of the pool that's been authorized, but not spent. Cancel some of the pork projects instead! 

Now, what isn’t evident in this focus on the past two years is that the COLA formula used today is different than that employed over the life of the program – in fact, it was changed pretty dramatically in the late 1970s.  And, for the very most part since that change, it seems to have worked to the benefit of Social Security recipients.   


That said, it’s hard to argue – whatever the formula – that costs of many things are rising, and that those on fixed incomes are particularly vulnerable. 


No Editor’s Choice this week – just a very serious issue to keep our eyes on. 


Oh – and if you’ve been passed an email that blames the current situation on Congress – it’s a hoax.  MORE at    

There are more verbatims on the following pages...

Be worried very worried -- for those that are expecting to collect in the future an amount equal to the amount contributed in after tax dollars -- this will be a very poor investment.

If I were a Social Security beneficiary, I would want and, possibly expect, an increase.  If I were a legislator, I would want a special payment so I could show my constituents that I am working for them.  Since I am a working stiff, I vote no increase if it's not warranted.

Nothing. It's cold but fair.

I'm starting my third year with a 20% paycut plus a 35% increase in my health care insurance. If there's no increase in the cost of living, then there should be no upward adjustment.

SS should always be increased each year, or a stimulus check mailed out.  Those who are seniors in 2011 deserve a raise; after all, prices keep rising but they get no increase in their checks.  Most seniors on SS right now have no other means of income; there were no 401(k) plans in which to contribute back in the 50s and 60s when they were working.  Lots had no pensions, either.  SS is their only means of living.  Most of us responding to this are working and thus saving for our retirement (hopefully)  in some sort of retirement vehicle, so if we receive no SS raise one year after we retire, we'll have other means of income.

There is insecurity aplenty, but as the economy recovers over the next few years (I am an optimist and retiring next year), this issue will go away and the long term viability of the program will finally be addressed. I told you I am an optimist.

There isn't money for increases. The "plan" defines that there should not be any increases this year. If there is any increase in costs to seniors, it would be in medical costs which are primarily dealt with through Medicare.


Not sure whose cost of living has not has for everyone I know.  This certainly hurts the Seniors most.

We should do something for those who don't have other assets and must rely on Social Security for the majority of their living expenses.  Civilized societies have an obligation to take care of those unable to care for themselves.  I sometimes think that we are all on the edge of a cliff and the strongest among us are throwing the weakest over the ledge.  What they don't seem to realize is that by their actions they are making the cliff less stable for all of us.

Until they figure out how to make the system solvent for the long term (yeah, like that's going to happen) they should not be making adjustments when adjustments are not called for.

I do feel sorry for folks who don't get a raise, but I didn't get one either this year.  Social Security was NEVER meant to be a complete replacement to income.  Folks need to buck up and figure it out.  We can't have a nanny state.

I'm mostly concerned with what SS will look like in 30 years, or won't look like.

Most working people haven't received a COLA adjustment so I don't think it's such a bad thing that social security is staying the same.  In fact, most people have taken a pay cut so really those seniors are better off than most.

People shouldn't get it both ways.  We can argue lots about the accuracy of inflation measurement.  But the COLA is what its for- to keep up with inflation.  If no inflation, then no more money.  Its not just magic to give you more money.

I find it puzzling that anyone thinks a Social Security recipient should get more just because he or she lived another year.  A COLA is meant to address inflation.  If there's no inflation, there's no COLA.  How hard is that?

The issue for our health plan is the cost of Medicare Advantage is going up by over 10% AFTER an increase of the upfront deductible; our retirees are not happy campers. Our pension plan is not providing any COLA for the foreseeable future as well. The Gray Panthers are circling!


There is a process and a formula set up, and Congress should follow it and not make exceptions.  Recipients should not be led to expect a "bonus" when the formula calls for no COLA, just as senior management shouldn't expect a bonus if their bonus formula results in no payout (I couldn't help it). Social Security is already a great deal for most current recipients.

Our seniors have to understand if the COLA is zero, there's a reason.  No growth.  Personally, the only COLA I've seen in my own pay in the last 4 years has been negative.

"Lack thereof" so you really don't want an unbiased response. No inflation no increase. Have you noticed most people are not getting a raise or have no job.

Just as many of us working stiffs aren't getting increases, neither should SSN recipients receive increases. Spread the misery around evenly.

"Social Security could be ""saved"" from insolvency by first eliminating the tax break for higher income folks.  Why on earth someone implemented the cutoff so that higher earners get a break while those on minimum wage pay all year long is just beyond me.

Why does anyone think they deserve a COLA when there is supposedly no inflation?  Working people have lived without increases for years, whether there was inflation or not, simply because employers didn't want to or couldn't afford to give increases.  I am currently paid what I was paid in the year 2000, because the economy is in tatters and employers feel they can squeeze those of us in the middle---while continuing to pay the highest executives obscenely enormous sums.  So imho, those retired folks should also expect a little of the pain....


Maybe I'm only feeling cranky today, but people who continue to want more when there simply isn't more to give, just annoy me."

Social Security is little more than a legal Ponzi Scheme.  We need to begin increasing the FICA tax rate gradually each year if we hope to keep Social Security operating.  That said, I'm really not counting on Social Security in my retirement planning, because I'm not sure that it will still be around by the time I retire.

As long as the cost of a loaf of bread and/or a cup of coffee continues to increase, some adjustment is appropriate.

Cost of living and consumer price indexes just seem to elude my intelligence.  I can't figure out how those things are officially unmoved when my pocket book says something very different.  Hmmm.  Maybe they should share the official list so I can buy THOSE goods and services because I'm obviously spending my money on the worng & increasingly expensive things!!

Take the money from our grandchildren, whether we seniors need it or not.

The COLA = Cost of Living Adjustment.  If the cost of living does not change there is no reason for taxpayer dollars to fund a raise; not even a temporary one.  It would seem as if that could be inflationary and would result in a decrease in spendable income year over year.  For example, a SS recipient whose SS income is $20,000 this year who receives an additional $250. because the cost of living does not go up who then receives a 2% COLA next year (because the cost of living has gone up) would actually have a lower income the following year because in the following year $2,4000 would be the equivalent of $20,000 the prior year but their income would have been $20,250 due to some misguided idea that they need more money when the cost of living has not increased.

While I can understand the feelings behind wanting to help seniors with a COLA, I see no reason to add any more to the current deficits.  It's also hard to think of them getting this extra money when I've been paying into Social Security for over 30 years and probably won't see a dime of the money that's been taken out of my paychecks.   I say give it back to me and let me put more into my 401(k) or some other retirement plan.  Even if I blow it with bad investments, at least I can only blame myself.


I don't understand how our government can give social security to people who never lived here their entire life, never contributed to this country in any way, but chose to retire here from another country.  It just doesn't seem fair - and to top it off, they get more money and benefits than lifetime Americans and the survivors of soldiers that paid the ultimate sacrifice.  They keep threatening that social security is going to "run out".  Our social security benefits might not be depleted if they would quit giving it away to people who never paid in.  I just don't get it.

I believe a good first step would be to calculate the CPI fairly, accurately, and honestly. However, that would be too great of an expense in COLA money, so that's not going to happen. BTW, maybe if that were done there might be hope for an honest calculation of unemployed people, eh? 9.6% MY FOOT!

Social Security is just another best-laid government plan gone awry - fortunately, it should be all dried up by the time I get around to retiring, so we'll no longer have to have these debates!  It's just too bad I've put so much money into it that I'll never see!

I don't expect to receive Social Security.  I have reduced my angst about the current withholding from my paycheck for no direct benefit by telling myself that those taxes are funding my dad's retirement.

The stats show that a large proportion of those receiving SS rely on it as their primary income.  And even though someone determined there was no inflation this year, the same can't be said for the cost of groceries and utilities.  So the $250 would be better than nothing.

My husband is on SS, so 2 years without an increase does hurt. Not sure where the government gets their formula for cost of living and not sure where they live, because the price of gas, property taxes, the price of heat and electric and just about everything is going up where we live. So if no COLA a $250 check would help to take away the sting.

The fact that there is a COLA feature is a bonus...especially with no downside adjustment. Our DB plan had a negative adjustment last year.

They didn't get set back by the negative COLA last year.  Holding steady is not always a bad thing when the alternative is to push us further into indebtedness.  Most everyone else has been in the same boat for a while.

I'm torn - if I vote against COLA increases, then the value of my SS payments when I retire will be even less to rely on during retirement than they already are for folks. However, if I vote for these "additional" COLA increases, the chances that SS will be bankrupt (which probably will happen regardless of COLA) and I will get absolutely nothing out of it increase exponentially.