Until last year, Janet Albrecht could afford roast beef sandwiches or tuna salad for lunch. But now the widowed 78-year-old has to cut back on her meals because her Social Security benefits have not kept pace with rising food, housing and health care costs in recent years.
Albrecht, a retired graphic designer, estimates she pays $100 more per month at the grocery store than she did before 2021’s rapid rise in inflation. Her landlord has raised her monthly rent by a total of $65 over the past two years, her utilities are higher, and some of the seven medications she takes daily after a heart attack have become more expensive. She hasn’t been to the hairdresser in over a year, even though she doesn’t like wearing her hair so long.
“I have to have ramen for lunch, which I’ve never had in my life until recently,” said Albrecht, who lives in Indiana, Pennsylvania, and lives mostly on his $1,163 monthly welfare check. “If it’s not discounted, I just don’t eat it. I haven’t had beef in ages. I can’t afford it.”
Many other seniors are also feeling the pressure of inflation. According to a recent analysis by the advocacy group The Senior Citizens League, Social Security benefits have lost 20 percent of their purchasing power since 2010. Those who retired this year would have to earn an average of $370 a month or $4,440 a year extra to regain the lost value.
In other words, the $100 a household spent in 2010 would only be worth $80 today.
Each January, welfare recipients receive an annual cost-of-living adjustment, known as a COLA. But the increases often don’t keep pace with actual price increases – hurting seniors, many of whom live on fixed incomes and rely heavily on their welfare benefits. Eight of the last 15 adjustments have been lower than inflation for that year.
Social benefits rose by 58 percent between 2010 and 2024, but the cost of goods and services purchased by a typical pensioner rose by 73 percent during that period, the league said. The prices of bread and minced meat, for example, rose by almost 147 percent and 73 percent respectively during that period.
The rise in inflation in recent years has led to some of the biggest annual adjustments since the early 1980s. Benefit recipients received hefty increases of 5.9% for 2022 and 8.7% for 2023 – but only 3.2% for this year as inflation has cooled.
However, in the last five years, only the 2023 adjustment was better than the inflation rate, according to the league. In the other years, the COLAs lagged behind inflation by up to 1.1 percentage points.
The annual adjustments are based on the percentage change in an inflation index from the average of the third quarter of the current year compared to the same period last year. Next year’s increase will be announced in October but is expected to be 2.6% based on inflation rates through June, said Shannon Benton, the league’s executive director. That’s not enough to cover the actual expenses of many seniors, especially as the deficit piles up when previous COLAs don’t cover price increases, she said.
“We’re hearing that household expenses have risen faster than the COLA over the past year, especially food and housing costs,” she said, adding that some seniors are being forced to use up their retirement savings faster and take on credit card debt.
For Albrecht, it seems as if her social security benefits have lost more than 20 percent of their purchasing power.
“Food prices are still going up. Utility prices have skyrocketed,” she said. “Let’s face it, the cost of everything has gone up.”
For more CNN news and newsletters, create an account at CNN.com
