8 Fast-Growing Expenses for Retirees, Ranked

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The average Social Security payments are worth only about 80 cents on the dollar compared to 2010, according to a new report published by the Senior Citizens League.

This means that retirees who depend solely on Social Security to meet their living expenses have lost a fifth of their buying power to inflation in just 14 years. The current average annual payment of $24,290 would need to rise by $4,442 per year to rebuild its purchasing power to 2010 levels, according to the report.

While the cost-of-living adjustments received by beneficiaries in 2021 and 2022 were welcomed news, even those substantial increases have failed to keep pace with inflation in the time since — as has this year’s increase of 3.2%.

Edward Cates, the non-profit’s chair, noted that seniors’ specific spending needs are prone to even higher average inflation compared with broader price indices. This is one reason why the organization advocates for tying the annual COLA to the Consumer Price Index for the Elderly, which better reflects senior’s costs.

“Much of Social Security’s loss of buying power comes from insufficient cost-of-living adjustments,” the report states. “COLAs have lagged inflation in eight of the last 15 years, with two additional years where they matched exactly.”

Ultimately, the report concludes, Congress must act quickly to stabilize Social Security’s finances to support the stronger COLAs that seniors need, while also ensuring that the broader program can continue to provide income stability for retirees far into the future.

See the accompanying slideshow for eight spending categories that are inflating the fastest for today’s retirees.

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