Always Do the Math
Many retired citizens were pleased to see that Social Security was adjusting their monthly Social Security for 2022 by 5.9%. However, as with all things administered by a federal government agency, it is unwise to think you will receive 5.9%. Why? Because while one hand gives you something to put in your pocket, another government program will reach in to retrieve it from your wallet.
Medicare Costs Are Increasing
Inflation is hitting Medicare care costs. This includes the salaries for medical professionals, the costs of running a hospital, the increased costs of utilities, and the exploding costs of pharmaceuticals. Where does Medicare get the money to pay for these things? From taxpayers that are working and from taxpayers who are out of the workforce. This year, my Medicare deduction from my Social Security income was $148.50. Next year, assuming certain things about our income, it will be $170.10. That is, the Medicare Part B premium is increasing by 14.5%. So, my 5.9% increase from Social Security is really 4.9%.
Why This Matters
This really won’t impact our family budget. Our income from Social Security, Cindie’s part-time work at Beehive Homes, our dividends, and my covered call options trading are more than sufficient. However, for at least four million citizens, the average social security benefit for 2021 was $1,543 per month. Their increase, based on a 4.9% increase, is $75.60 per month. In other words, they have to pay their increasing utility bills, gasoline costs, and food purchases with $75 more in income. That will be, for many, challenging.
What Should You Do?
First of all, if you are a Christian, remember what is printed on our currency: “In God We Trust.” If you put your trust in government, Social Security, and Medicare, you are apt to be disappointed. Secondly, you should plan. Planning is work. However, if you don’t plan today, your work tomorrow will become more difficult. If you need help, ask for help.