‘This is significant’: Alaska Social Security recipients to see 5.9% rise in payments next year
JUNEAU, Alaska (KTUU) - Alaskans who receive Social Security benefits will see a 5.9% rise in monthly payments, starting in January next year.
According to the Social Security Administration, close to 108,000 older Alaskans receive the benefit. The average payment is currently close to $1,500 each month, but that is set to rise by around $90 per recipient.
“This is significant,” said Eileen Hosey, a case manager with Catholic Community Services in Juneau. She works with low-income seniors who often struggle to pay for groceries and their heating bills.
“That’s a very meaningful amount for people of low income,” Hosey explained about the rate rise.
AARP, an organization that advocates for seniors, tracks the annual cost-of-living-adjustments made for Social Security. The 2022 rate announcement is the biggest one-year rise since 1983.
Rising prices have made life more difficult for low-income Alaskans.
Ralph Townsend, PhD, is the head of the Institute of Social and Economic Research. He said Alaska has been following trends seen nationally. Last year, there was deflation during the pandemic, but in April, inflation saw prices suddenly shoot up.
Gasoline prices nationally are at their highest levels since 2014 with Alaska’s gas prices above the national average. The U.S. Bureau of Labor Statistics shows that costs for groceries, housing and power bills in Alaska have also been increasing.
“Is this 5% inflation that we’re seeing in the Consumer Price Index transitory or is it permanent?” Townsend asked. Economists nationally are debating that amid global supply chain challenges.
A 2019 report from the Alaska Department of Labor and Workforce Development shows that it’s far more costly to live in Alaska’s major cities than most U.S. metropolitan areas. And, that’s not to mention rural Alaska where common household goods can be much more expensive still.
A big question for low-income Alaska seniors is whether this rate rise will make them ineligible for programs like Adult Public Assistance or the Senior Benefits Program, Hosey said.
Another question is whether Medicare premiums will rise in January, cutting into the Social Security bump. Those rates haven’t been announced yet, but AARP anticipates that Medicare costs will only increase modestly next year.
Hosey, a recipient of Social Security herself, said the extra $100 or so per month or $1,200 each year would deliver a nice boost.
“We could buy outrageous magazine subscriptions,” she joked. “Do somethings for ourselves or our grandkids, and have a little bit more freedom with our dollars.”
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