Social Security recipients shouldn’t expect a big increase in monthly benefits come January.
Preliminary figures show the annual benefit boost will be between 1 percent and 2 percent, which would be among the lowest since automatic adjustments were adopted in 1975. Monthly benefits for retired workers now average $1,237, meaning the typical retiree can expect a raise of between $12 and $24 a month.
The size of the increase will be made official Tuesday, when the government releases inflation figures for September. The announcement is unlikely to please a big group of voters — 56 million people get benefits — just three weeks before elections for president and Congress.
The cost-of-living adjustment, or COLA, is tied to a government measure of inflation adopted by Congress in the 1970s. It shows that consumer prices have gone up by less than 2 percent in the past year.
“Basically, for the past 12 months, prices did not go up as rapidly as they did the year before,” said Polina Vlasenko, an economist at the American Institute for Economic Research, based in Great Barrington, Mass.
This year, Social Security recipients received a 3.6 percent increase in benefits after getting no increase the previous two years.
Some of next year’s raise could be wiped out by higher Medicare premiums, which are deducted from Social Security payments. The Medicare Part B premium, which covers doctor visits, is expected to rise by about $7 per month for 2013, according to government projections.
The premium currently is $99.90 a month for most seniors. Medicare is expected to announce the premium for 2013 in the coming weeks.