Improving COLA calculations on the Alliance’s to-do list

Executive Director of the Alliance for Retired Americans, Rich Fiesta, joined the America’s Work Force Union Podcast to talk about the recent COLA adjustment for those receiving Social Security benefits and a way to improve COLA adjustment calculations in the future for retirees.

Anyone currently receiving Social Security benefits received an average increase of 3.2 percent. The increase was part of the Cost-of-Living Adjustment (COLA) determined by a formula the Bureau of Labor Statistics reviewed in the third quarter. The Alliance supports a change in the formula to consider the expense by retirees and not an average worker. According to Fiesta, the new formula would result in average increases of 3.2 to 3.9 percent more than the standard COLA rates.

To create a new formula, Fiesta and the Alliance have proposed the creation of a committee that would review and develop the formula based on retirees' expenditures. There is not enough momentum yet to determine how the committee would be formed, and several issues in Congress must be addressed first. Fiesta believes once they can create the committee, retirees would be able to receive a COLA based more on the transportation and grocery inflation rates. This, in turn, would provide a better living for retirees instead of being forced to pinch pennies during retirement, he said.

The Alliance has been supporting the local UAW striking members across the country. They have provided food, water and warm weather clothing for the striking workers. They are standing in solidarity with the workers, who seem ready to stay on strike as long as it takes to get a new contract. According to Fiesta, as long as the UAW members stay on strike, the Alliance will provide their support. 

To hear more from Rich Fiesta, please listen to the show above.