Starting January 2012, Social Security Disability Income (SSDI) will increase by a modest 3.6 percent due to an increase in the Cost of Living Adjustment (COLA), the first increase to COLA since 2009. The increase is good news for Wisconsin residents. According to the Social Security Administration, as of Dec. 2010, over 107,000 Wisconsin residents received some form of Social Security assistance.
What these increases mean is that people on SSDI will receive an average extra $39 per month or almost $468 for the year. Starting one month earlier, December of this year, the over 8 million people who receive Supplemental Security Income (SSI) will get an additional $18 monthly or $216 for the year.
A spokesman for the National Committee to Preserve Social Security and Medicare said the increased amounts may not seem like much, but the COLA increase announcement gives people signs that respite could be near. An AARP spokeswoman stated that this increase highlights how important Social Security income is to Americans.
The Cost of Living Adjustment bases its yearly pay increases on a measure of the Consumer Price Index known as the CPI for Urban Wage Earners and Clerical Workers (CPI-W). Consumer prices in the current year are compared to the previous year’s consumer prices, for the months of July-September. When the CPI-W increases, so do SSDI payments. If the CPI-W decreases, SSDI payments do not increase.
This summer, President Obama broached the idea of calculating the COLA in a way that would reduce any annual benefits. The measure was rejected flatly by senior citizen advocacy groups, but talks are continuing. The idea could potentially be brought up again. A spokesman for the advocacy group Social Security Works said that politicians who threaten Social Security are indirectly threatening the lives of seniors, as well as their own political careers.
Source: Bloomberg Businessweek, “Social Security benefits to go up 3.6 percent,” Stephen Ohlemacher, Oct. 19, 2011