If SSA was able to adjust for inflation in realtime, that would ease the burden (or the perception of a burden) of inflation. But the COLA change occurs the following year. The inflated expense is out the door, and the inflated reimbursement comes a year later. The time lag between outflow and resolution weighs on people.
Agreed! I enjoyed the vibe at community watch parties, bars and restaurants, and having folks over at our house to watch the games. I went five matches at the Rose Bowl during the 1994 World Cup. I live 15 minutes from the venue in Los Angeles now - couldn't be bothered to go in person this year. Much more of a money grab now.
Helpful article. Of course, folks can quibble about the assumptions for the couples. For example, my pension will reduce to 50% benefit for my wife when I die. That lowers the income component significantly, but will also reduce the tax obligation - there's less to tax. Perhaps it's more appropriate to discuss the widow/widower's financial changes, not focus on the widow/widower tax.
There's a historical context to this, of course. SS was the solution to a problem nearly 100 years ago. Epic poverty and unemployment during the Depression, widespread failure of banks and financial institutions, and little personal wealth in the form of home ownership or investments. SS was intended to provide a basic income for the elderly who had little and, as RDQ often points out, had a much shorter life expectancy than today. Is it any wonder that the system set up in the 1930s (tweaked occasionally, but not fundamentally, since then) isn't quite fit for purpose today? Same argument is made on this site about health care. Our employer-focused health insurance system had its genesis in the price control systems of the 1940s economy. Save for periodic lurches (Medicare for over-65s, Medicaid for low income, ACA for a wide swath not eligible for other coverage), the system reflects its origin rather than today's needs. I agree that our political system - or our markets - should provide a better solution. I also doubt that they will, be it for political reasons, polarization, or distrust of institutions. Perhaps I'll go back to the car-buying post on another HD page now. . . .
That gets us back to your main point (here and in other articles). The US has a progressive tax and health care system - mostly. Tax rates increase with income. Medicare costs increase with income / wealth withdrawals from retirement accounts. We don't have great healthcare options for younger people who aren't covered by work-sponsored insurance or who qualify for an assistance program of some sort. If this was the result of a reasoned policy debate or election results, we'd say that's our choice v. Europe's choice. Sadly, the general sense from HD readers is that our tax / health system has been cobbled together over years without much thought. We just deal with the results.
Yup, there ain't any free. The sales tax / VAT in the UK is 20% on most things (other than food and children's clothing). Tell an American that they have to pay that much and loads of tea go into the harbor. . . .
Um, I can't think of any retail store that (a) isn't based on / doesn't encourage impulse buying or (b) only sells wholesome, healthy products. We're empty-nesters, and just bought a cartload of fresh berries, seafood, imported cheese, etc. at Costco today. Great savings over a local chain store. And the annual fee is easily covered over the cost of a year or by a major purchase. Take a look at the interesting article in the Wall Street Journal this week about how well employees are treated, too. Yup, I'm a fan.
Comments
If SSA was able to adjust for inflation in realtime, that would ease the burden (or the perception of a burden) of inflation. But the COLA change occurs the following year. The inflated expense is out the door, and the inflated reimbursement comes a year later. The time lag between outflow and resolution weighs on people.
Post: Inflation, prices, COLAs, retirement and the last 16 years
Link to comment from August 1, 2026
Agreed! I enjoyed the vibe at community watch parties, bars and restaurants, and having folks over at our house to watch the games. I went five matches at the Rose Bowl during the 1994 World Cup. I live 15 minutes from the venue in Los Angeles now - couldn't be bothered to go in person this year. Much more of a money grab now.
Post: FIFA Financials
Link to comment from July 25, 2026
Helpful article. Of course, folks can quibble about the assumptions for the couples. For example, my pension will reduce to 50% benefit for my wife when I die. That lowers the income component significantly, but will also reduce the tax obligation - there's less to tax. Perhaps it's more appropriate to discuss the widow/widower's financial changes, not focus on the widow/widower tax.
Post: Widow Tax
Link to comment from July 25, 2026
Or, as noted financial journalist Jonathan Clements would say, don't attempt to time the market.
Post: Market Indicators
Link to comment from July 25, 2026
Got it. Eat well, drive safely, rob more banks!
Post: A Can of Worms
Link to comment from July 18, 2026
There's a historical context to this, of course. SS was the solution to a problem nearly 100 years ago. Epic poverty and unemployment during the Depression, widespread failure of banks and financial institutions, and little personal wealth in the form of home ownership or investments. SS was intended to provide a basic income for the elderly who had little and, as RDQ often points out, had a much shorter life expectancy than today. Is it any wonder that the system set up in the 1930s (tweaked occasionally, but not fundamentally, since then) isn't quite fit for purpose today? Same argument is made on this site about health care. Our employer-focused health insurance system had its genesis in the price control systems of the 1940s economy. Save for periodic lurches (Medicare for over-65s, Medicaid for low income, ACA for a wide swath not eligible for other coverage), the system reflects its origin rather than today's needs. I agree that our political system - or our markets - should provide a better solution. I also doubt that they will, be it for political reasons, polarization, or distrust of institutions. Perhaps I'll go back to the car-buying post on another HD page now. . . .
Post: Many seniors think we paid for our Social Security benefits based on the FICA taxes we paid. Let’s dispel that myth- we didn’t
Link to comment from July 18, 2026
That gets us back to your main point (here and in other articles). The US has a progressive tax and health care system - mostly. Tax rates increase with income. Medicare costs increase with income / wealth withdrawals from retirement accounts. We don't have great healthcare options for younger people who aren't covered by work-sponsored insurance or who qualify for an assistance program of some sort. If this was the result of a reasoned policy debate or election results, we'd say that's our choice v. Europe's choice. Sadly, the general sense from HD readers is that our tax / health system has been cobbled together over years without much thought. We just deal with the results.
Post: A taxing situation, but is it reality?
Link to comment from July 12, 2026
Yup, there ain't any free. The sales tax / VAT in the UK is 20% on most things (other than food and children's clothing). Tell an American that they have to pay that much and loads of tea go into the harbor. . . .
Post: A taxing situation, but is it reality?
Link to comment from July 12, 2026
I'll make sure not to invite you to breakfast at any diner that offers a stack of three pancakes on the menu. Only one for you, Mr. Q!
Post: Frittering away Frugality
Link to comment from July 12, 2026
Um, I can't think of any retail store that (a) isn't based on / doesn't encourage impulse buying or (b) only sells wholesome, healthy products. We're empty-nesters, and just bought a cartload of fresh berries, seafood, imported cheese, etc. at Costco today. Great savings over a local chain store. And the annual fee is easily covered over the cost of a year or by a major purchase. Take a look at the interesting article in the Wall Street Journal this week about how well employees are treated, too. Yup, I'm a fan.
Post: Frittering away Frugality
Link to comment from July 11, 2026