Social Security benefits will rise 2.3% in 2008—or an average of $24 monthly—netting the 54 million recipients their smallest increase in four years. The cost of living adjustment, now $1,079 per month for the average retiree, is based on the third-quarter change in consumer prices, the AP reports; advocates for the elderly argue that gauge is too limited.
One advocate said those over age 65 have lost 40% of their purchasing power since 2000, and the yearly adjustment should better reflect retirees’ needs. Indeed, medical prices have soared this year. The Social Security increase will be partly offset by the rising Medicare premium, though the 3.1% hike—$2.50 a month—is the smallest in six years. (Read more Social Security stories.)