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The purchasing power of benefits has fallen 36% since 2000
The Elderly League also assessed the extent to which social security benefits kept pace with rising costs and found them to be insufficient.
Over the past year, in a context of persistently high inflation, eggs were the fastest growing cost for seniors, according to the group’s analysis of Bureau of Labor Statistics data through February. Other categories that ranked among the five fastest growing costs are apples, bread, coffee and dental visits.
Since 2000, Social Security benefits have lost 36% of their purchasing power, according to calculations by the Senior League.
To be able to live off Social Security benefits as well as recipients in 2000, today’s retirees would need an additional $516.70 a month, the nonpartisan seniors group found.
The updated analysis of the loss of purchasing power – measured from January 2000 to February 2023 – has improved from a 40% decline seen in last year’s study. Still, the slightly improved loss of purchasing power of 36% remains one of the biggest losses on record, according to the group’s analysis.
Eggs have also topped the list of fastest growing costs for seniors since 2000. Other categories in the top five include prescription drugs, fuel oil, dental services and Medicare Part B premiums.
A caveat to a record cost-of-living adjustment this year is the extra money – estimated at more than $140 per month — may help increase spending levels among older Americans, according to research from the Bank of America Institute.
While higher spending may complicate the fight against higher inflation, it is delayed relief for older Americans, whose cost of living adjustment was lower than price growth in 2022.
“The average retiree has found it extremely difficult to live with these high inflation rates,” David Tinsley, senior economist at the Bank of America Institute, previously told CNBC.com.