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A social security card surrounded by money and a calculator.Every year, the Social Security Administration (SSA) evaluates the fluctuation in the cost of living in the United States. From there, the SSA formulates a cost-of-living adjustment (COLA) that determines how much social security and supplemental security income (SSI) benefit payments should increase in order to keep up with inflation.

In 2022, inflation has reached 8.5%, the highest inflation rate since 1981. As a result, the COLA has to account for the rising cost of everything from gasoline to groceries. Keep reading to learn more about the cost-of-living adjustment for 2022 and how it will impact your social security payments.

What Is the COLA?

A woman feeling stressed looking at paperwork.COLA, or the cost-of-living adjustment, accommodates the fluctuations in the cost of everyday goods and services. Applied every year to Social Security benefits, the COLA protects disability beneficiaries from inflation.

Supplemental Security Income (SSI) is a needs-based program designed to provide financial benefits to individuals whose disabilities prevent them from earning a living. The COLA, added to Social Security benefits in 1975, is crucial to ensuring the value of these important benefits isn’t lowered. Without it, disabled Americans and their families would lack the means to pay for the ever-increasing cost of everyday essentials.

If you need help understanding how this year’s COLA will affect your SSI benefits, Dr. Bill LaTour is extremely well-versed in social security law and he can help you sort out any questions you may have.

How Is the COLA Calculated?

Whether the COLA increases or decreases depends on the consumer price index (CPI). The CPI is the federal government’s formal measurement of inflation. It is formed by measuring the changes in the prices of 80,000 goods and services. The SSA reviews the third quarter of the current year’s CPI and compares it to the third quarter of the previous year. If inflation has occurred, the average CPI will have risen and SS beneficiaries will receive a “raise” in their benefits as a result.

In the very rare occurrence that the CPI average decreases and we experience deflation in the cost of living, benefits will remain the same.

Payments in 2021 vs. 2022

A woman helping a man in a wheelchair understand his disability benefits.In 2021, the average retired worker was receiving $1,565 a month and the average disabled worker was bringing in $1,277.

With a COLA increase of 5.9 percent in 2022, these payments have increased by around $93 and $75 a month, respectively.

These changes take effect on December 31 each year and are reflected in your January payment. The change to your benefits happens automatically and does not require you to submit any documents or forms.

Have Questions About Your Disability Benefits?

Understanding the factors that can affect your monthly Social Security disability benefits, like COLA, can be overwhelming.

If you have questions about your current benefits or need help applying for SSDI/SSI, please don’t hesitate to get in touch. Dr. Bill LaTour and his experienced team of California disability lawyers have years of experience helping disabled individuals in Los Angeles and across Southern California receive the benefits they need.

Just fill out our online form or give us a call to schedule a free case evaluation today.