Social Security payments will increase by 1.7 percent next year. That comes to about $20 a month for the average Social Security recipient.
This will affect 70 million Americans, mostly retirees and veterans, according to Diane Swonk, senior economist for Mesirow Financial. But Swonk says the cost-of-living increase falls short of the inflation that older Americans are actually seeing.
"They spend more disproportionately on things like prescription drugs that are going up much more rapidly than the overall. They spend more on shelter and food, which are also going up more rapidly. They’re paying higher inflation but getting less compensation for it." Swonk told Here & Now's Robin Young.
Swonk went on to say that older Americans will have to make difficult decisions in their spending.
“When things like meat, poultry, protein, dairy products at the store go up in price, these people are forced to make very difficult trade-offs — to buy cheaper kinds of pasta, rice, less vegetables and compromise their diet as well,” she said.
This segment aired on October 22, 2014.