For the second consecutive year, seniors will not get a cost of living adjustment in their Social Security checks for 2011 [see USA Today, “No Social Security Benefits Boost Expected for 2011“). This will certainly become an election year issue, with the parties accusing each other of not caring about the welfare of
Politics aside, it makes sense from an inflation standpoint. There has been no aggregate inflation for two years now. And lest we forget that seniors on Medicare Part D received a rebate check in the summer of $2
50 per person to cover the “donut hole” in the program (a married couple on Medicare Part D received $500).
Of greater concern, however, is that from reading some newspaper articles, it appears that the lack of a COLA boost is the difference between surviving and sinking for some families. What gives here? If seniors do not receive a COLA of, say, $50 of $100 a month, does that mean they will be impoverished for life? This illustrates a bigger picture that working baby boomers and later generations shouldn't ignore: saving for retirement is crucial. It is not enough to rely on Social Security, the HHS secretary, the president, or Congress to provide the standard of living to which people aspire.