Further frugality for seniors
As the market value of Individual Retirement Accounts and 401-k plans continued to plummet during the latest quarter, the government announced that Social Security recipients will receive the smallest increase in benefit checks in four years. The 1.4 percent rise, which will be about $13 more a month for a typical retiree, will be partially eaten up by a $4.70 hike in monthly Medicare premiums. Further pinching seniors is that those who set aside a retirement nest egg to supplement Social Security are finding those accounts are worth much less today than a year ago.
Social Security ties its cost-of-living adjustments to the rise in Consumer Price Index during the past fiscal year. The good news that inflation was relatively low, meaning that a dollar stretches nearly as far as it did last year at this time, also means increases are slight. But the elderly, who spend a larger portion of their income on medical expenses than do younger Americans, continue to worry about paying for costly prescription drugs. Medicare premiums which will rise by 8.7 percent – far above the rate of inflation – are mandated by Congress. Surely then, Congress must realize the cost of health care is rising at a faster pace and that seniors need some relief.
Yet, Congress failed once again to address an issue that affects more than 40 million Americans before recessing to campaign for re-election.