Want to Stimulate the Economy? Give Seniors a Fair COLA, RetireSafe Says Today
Group Launches new tool to give America's biggest spenders more buying power
RESTON, Va., Jan. 29 /PRNewswire-USNewswire/ -- Today, RetireSafe unveiled the first and only online cost of living adjustment (COLA) calculator designed to put money where it is needed and will be spent immediately: in the pocketbooks of seniors. The Fair COLA Calculator, a comparison tool for calculating annual Social Security cost of living adjustments, represents a change in the way retirees' annual cost of living adjustments would be calculated.
"This change can help boost the economy, and help seniors pay their bills. With the government spending trillions on righting the economy, the RetireSafe Fair COLA Calculator shows an easy fix. And it is a fair fix for both seniors and the economy," says Michelle Plasari, President of RetireSafe.
To achieve a fair COLA, RetireSafe recommends that the government use a fair formula for calculating annual cost-of-living adjustments. The current annual Social Security COLA is based on the CPI-W, an index designed to track the spending of younger urban professionals. It doesn't account for the increased costs seniors face each month on items such as health care and medicines. The government does in fact track an experimental CPI-E that more accurately weighs the spending patterns of seniors. In most years, the CPI-E is higher.
In these unstable economic times, RetireSafe believes Social Security COLAs should be based on which ever index is higher in a particular year, so seniors will have more to spend.
To demonstrate these differences, RetireSafe has developed an online calculator which compares what COLAs would be if based on the CPI-E versus the current indexing. This tool allows seniors and those approaching retirement to find out what they would have gotten or would get in the future if their increase is figured using a fair and realistic method.
Said Plasari, "We want seniors to use the Fair COLA calculator and then ask the Obama administration and Congress if they are serious about stimulating the economy, why not bring the COLA in line with realistic needs? And if the emphasis is on stimulating the economy, why not put money where it is needed and will be spent immediately: in the hands of seniors."
According to RetireSafe, seniors could be one of America's greatest resources for stimulating the economy. Unlike other demographic groups, seniors are not as concerned about acquiring additional savings or investments. They are consumers. They spend.
Said Plasari, "We believe the best way to stimulate economy is to put money where it will do the most good for the economy and for its seniors. As Americans live longer and spend more years in retirement, their Social Security benefits become increasingly less adequate to cover their living costs. Even seniors, who retire with an average benefit today, could risk living in poverty 15 or 20 years from today, especially as Medicare and other health care costs take increasing portion of their Social Security benefits."
RetireSafe urges Congress to act quickly, as part of the pending economic stimulus package, to finally give seniors a fair annual COLA that helps stimulate the economy and helps seniors keep up with their ever rising cost of living.
To view RetireSafe's Fair COLA Calculator visit www.RetireSafe.org/cola_calculator.html.
RetireSafe is a grassroots advocacy organization promoting dynamic solutions to America's retirement security challenges and dedicated to preserving and enhancing the options, benefits, and lives of older Americans.
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