Personal Finance

COLA Increase 2024: 2022 CPI-W rate, How Is It Calculated Annually?

Last year, as we moved from 2022 to 2023, the COLA increase was the highest in four decades, at 8.7 percent, due to elevated inflation.

COLA Increase 2024: In the United States of America, the Cost of Living Adjustment for 2024 is a very popular topic at the moment.

COLA, which stands for Cost-of-Living Adjustment, has been used in the United States for decades to enhance benefits in line with inflation.

What is COLA Increase 2024?

Image Source: Twitter

Last year, as we moved from 2022 to 2023, the COLA increase was the highest in four decades, at 8.7 percent, due to elevated inflation.

Unfortunately, the COLA increase for 2024 should be considerably less than the 8.7 percent seen in 2018.

The Senior Citizens League, a nonpartisan advocacy organisation, projects that the COLA increase in 2024 will be approximately 3.0%.

The good news is that the COLA has been reduced significantly because inflation has declined, so the purchasing power of recipients should not be significantly affected.

Cost-of-Living Adjustment (COLA): How Is It Calculated?

How is the annual COLA determined?

Image Source: Twitter

The CPI-W rate for the third quarter of 2022 was 291.901, a significant increase from the rate for the same period in 2021, which was 268.421. In the first two quarters of 2023, it has been 294.881 and 298.502, so another increase is anticipated in the third quarter.

The COLA is calculated based on the CPI-W’s measurement of the third-quarter inflation rate, which includes July, August, and September.

The average inflation rate for these three months is then compared to the average inflation rate for the same period one year ago.

Sweta Bharti

Sweta Bharti is a content writer at Eduvast who specializes in health, wellness, education, and informational content. She is currently pursuing a Bachelor of Ayurvedic Medicine and Surgery (BAMS) degree and has a growing academic foundation in Ayurveda, preventive healthcare, nutrition, and holistic wellness. At Eduvast, she focuses on creating well-researched, reader-friendly content that helps readers understand complex topics in a simple and accessible manner.

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