Floral Separator

7 Alarming Impacts of New Tariffs on Social Security Retirees

Floral Frame

Tariffs often lead to higher consumer prices, resulting in increased inflation. For retirees on fixed incomes, this means their dollars won't stretch as far, diminishing their purchasing power.

Increased Inflation Erodes Purchasing Power

Floral Frame

Social Security COLAs are designed to offset inflation. However, the 2025 COLA is set at 2.5%, down from 3.2% in 2024.

Insufficient Cost-of-Living Adjustments (COLAs)

Floral Frame

COLAs are currently calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

Mismatch Between CPI-W and Retiree Expenses

Floral Frame

Advocates suggest using the Consumer Price Index for the Elderly (CPI-E) to calculate COLAs, as it better represents retirees' expenses.

Potential Shift to CPI-E for More Accurate Adjustments

Floral Frame

Tariffs can increase the cost of imported medical supplies and pharmaceuticals. For retirees, who typically have higher healthcare needs, this could lead to significant financial strain.

Rising Healthcare Costs

Floral Frame

If Social Security benefits don't keep pace with inflation, retirees might need to withdraw more from their savings, potentially pushing them into higher tax brackets.

Higher Taxes on Benefits

Floral Frame

Trade tensions from tariffs can lead to economic instability and market fluctuations. Retirees relying on investment income may see reduced returns, impacting their overall financial security.

Economic Uncertainty and Market Volatility

Floral Frame

Follow for more

Like and Share

Also Comment