You’ve heard it before. Inflation is not measured accurately for seniors, it’s inadequate, most seniors rely on it … and on and on.
Calls for higher COLAs are based on surveys and generalizations about retirees. Nevertheless, if we want higher COLAs maybe they should be targeted at people in need.
For example, anyone who starts receiving Social Security at the maximum rate at full retirement age, receives no COLA for the first five years. They should have adequate resources and planned ahead.
Or, any retiree paying Medicare IRMAA premiums receives no COLA. That means single beneficiaries with incomes in retirement of $88,000 or more and couples at $176,000 and above income. Those folks are not relying on Social Security.
Such objective measures are easy to apply and better reflect need than asking folks how much they rely on SS.
A net worth based criteria could also be justified, but virtually impossible to apply.
I know, we are wading into means testing waters, but we are not talking about basic benefits for which there is a legitimate claim to earning benefits on a formula basis. We are talking about something additional which in theory is based on need already.