Dec. 31, 2023 - Epoch Times
08:29
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| Inflation is the hidden tax on top of all the other taxes that we already pay, as the Federal Reserve pumps more currency into the system. | |
| The result is that the government can fund more of its wars and more of its social programs using deficit spending while the actual value of the individual dollar falls to the floor and everything at the supermarket becomes more and more expensive. | |
| That's all on the negative side. | |
| However, on the positive side, if you can even think of it that way, people who receive Social Security will soon be seeing larger checks thanks to an inflation adjustment. | |
| Specifically, the Social Security Administration just came out and they announced that a new cost of living adjustment will be made to the 2024 Social Security payments that are set to be released. | |
| For your reference, the cost of living adjustment is calculated by using the year-over-year inflation rate averaging out the year-over-year differences between the months of July, August, and September. | |
| And so, back in the year 2021, Social Security recipients got a 1.3% bump in payments. | |
| In 2022, the increase was 5.9%. | |
| In 2023, the increase was a significantly higher 8.9% adjustment. | |
| And for this upcoming year, in 2024, the Social Security Administration announced that benefits will be increasing by 3.2%. | |
| Meaning that starting on January 1st of next year, of 2024, recipients of Social Security will have their checks increased by a cool 3.2%. | |
| Now, in terms of the dollar amount, quote, the retirement benefits will increase by about $50 a month on average once the cost of living adjustment goes into effect in January. | |
| $50 more on average per month translates to about $600 more per year, again, on average. | |
| Furthermore, besides the dollar amount increase, the cost of living adjustment also increased the thresholds for when the government begins deducting money from certain recipients of Social Security. | |
| For early retirees, or those who retire before the full federal retirement age, the Social Security Administration deducts $1 from every $2 above a designated threshold. | |
| It will be raised to $22,320 from $21,240 starting in 2024. | |
| The year an individual hits the full retirement age, the agency deducts $1 from every $3 earned above a second limit. | |
| Starting next year, that limit will increase from $56,520 to $59,520. | |
| Meaning in plain English that early retirees as well as those who continue working past the retirement age will see slightly higher Social Security checks. | |
| Now, the obvious question here is whether this is enough for seniors to be able to offset the rise of the actual cost of living. | |
| Well, soon after the official adjustment was announced, an organization called the Senior Citizens League came out with a statement saying that while this 3.2% adjustment is above the average, when you look back over the last 20 years, it still falls short of the current economic reality facing seniors. | |
| In fact, this organization, They conducted an internal survey of their members, and based on that survey, quote, Older adults are pessimistic about their finances in the coming months and the growing potential for Social Security benefit cuts. | |
| Furthermore, over two-thirds of the seniors who were surveyed, specifically 68% of the seniors, they said that, quote, Their household expenses remain at least 10% higher than one year ago, although the overall inflation rate has slowed. | |
| The situation has persisted over the past 12 months. | |
| And so, what this appears to amount to is that on paper, a 3.2% adjustment sounds nice, since it is higher than the 20-year average. | |
| However, that number, the 3.2%, it's calculated based on the Consumer Price Index, the CPI, which, for one, is a heavily manipulated measurement tool, which allows the government to essentially downplay inflation, but then also, secondly... | |
| Besides the fact that it's a tool that already downplays inflation, it doesn't even adequately measure what seniors and retirees in America actually pay for. | |
| Things like medication and healthcare. | |
| And so again, despite these generous cost of living adjustments, the current economy has a tremendous amount of seniors looking to get back into the workforce just to offset inflation. | |
| In fact, there was a recent report that was put out by the U.S. Senate's Special Committee on Aging. | |
| You can see it up on your screen. | |
| And this report, it focused on how senior Americans are having to un-retire in order to make ends meet. | |
| Quote, The report identifies that older Americans are increasingly turning to the gig economy to supplement their incomes and savings due to the flexibility it provides. | |
| Nearly one in three independent or gig workers are over the age of 55. | |
| And so what that means is that while 60% of retirees who are thinking of going back to work are just looking for something to do, a full 43% are going back because of inflation. | |
| Really keep these types of numbers in mind when you hear politicians as well as spokespeople for politicians saying things like this. | |
| When you look at inflation, when we look at where we are economically, and we are stronger economically than we have been in history. | |
| When you look at the unemployment numbers at 3.6 percent, when you look at the jobs numbers, more than 8.7 million of new jobs created. | |
| An economy so strong that senior citizens are going back into the workforce just to make ends meet. | |
| Now, the other question that you might be asking yourself is, where is the money coming from to fund this 3.2% social cost of living adjustment? | |
| I mean, after all, Social Security is headed towards insolvency, so it's not like the Social Security Administration is just flush with cash. | |
| Well, the answer to that question appears to be simple. | |
| The money is coming from us, the American taxpayers. | |
| That's because alongside this 3.2% increase in Social Security benefits is a corollary increase in the amount that Americans are taxed. | |
| Quote, Only the first $160,200 of income is subject to the FICA payroll tax that helps to fund Social Security and Medicare. | |
| This maximum taxable earnings limit will increase to $168,600 beginning in January 2024, a 5.2% jump. | |
| Nothing like a cool little secret backdoor tax increase on approximately 20% of American households. | |
| However, I think that most people, they wouldn't even mind the amount that were being taxed into Social Security if the federal bureaucracy wasn't so inept at managing the money. | |
| And that point, I believe, was summed up perfectly well in the following post on Twitter. | |
| Quote, That money would have been worth $1.9 million if I had gotten a 5% return. | |
| My annual interest would be $95,000. | |
| The government, on the other hand, promises me $3,075 per month at the age of 67, which is $37,000 per year. | |
| How is that not theft? | |
| And, well, perhaps the simple answer to that question is that it is. | |
| If you'd like to read more about the social security increase, I'll throw several resources down into the description box below this video so you can go deeper into the details for yourself. | |
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| Stay informed. |
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