“Inside the Social Security COLA Calculations,” by Gene Bond and Lloyd Lofton, ThinkAdvisor
“Social Security managers base the COLA on changes in the cost of one basket of goods and services. They could base the COLA on the cost of another standard shopping basket. What if you client has a completely different basket?”
LTC Comment, Stephen A. Moses, President, Center for Long-Term Care Reform:
Seems worthwhile to think about this topic a little. Inflation is on the rise. It affects different people in different ways but is really devastating to those on the financial edge. The flip side of helping Social Security beneficiaries keep up with the cost of living is the ironic fact that the extra public spending adds to inflationary pressures. That ascending spiral is what worries the Federal Reserve and impels it to fight inflation by hamstringing the economy which can turn into a vicious downward economic spiral. Bottom line, trying to centrally plan an economy instead of relying on free markets leads to asset bubbles, malinvestment, and shattering readjustments like the one we’re headed into now.
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