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Social Security recipients to get benefit hike soon, but steep costs eat up checks

Amidst all the volatility and uncertainty in the financial markets these days, one thing is definite: Come October 16, Uncle Sam will announce the cost-of-living adjustment for 34 million Americans who now receive Social Security benefits.

Unlike in years past, however, that adjustment is expected to be among the largest increases in 25 years.

No one yet knows exactly how big the automatic benefit hike will be. But experts are predicting that Social Security beneficiaries will see their monthly benefit rise by at least 5%, perhaps more. In calculating the COLA, Social Security will look at inflation over the 12 months ended September 2008. For the year ended August 2008, inflation as measured by the consumer price index (CPI-W) was running at 5.9%.

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That means the average monthly benefit could rise to about $1,142 from $1,079 now, a $63

http://finance.yahoo.com/focus-retirement/article/105942/Inflation-Brings-Bigger-Benefit,-and-Higher-Expenses?mod=retirement-post-spending