It's official No SS COLA [Social Security Cost-of-Living Adjustment]

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pshonore
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It's official No SS COLA [Social Security Cost-of-Living Adjustment]

Post by pshonore » Wed Sep 16, 2015 7:48 am

[Thread merged into here, see below. --admin LadyGeek]

BLS released the Aug CPI figures today. Right now the three month running average (June,July,Aug) for the CPI-W stands at 233.659 . The benchmark previous year average (July Aug Sept) is 234.170 . Unless next month's CPI shows about a 1% increase over August (extremely unlikely), the will be no SSI COLA for 2016.
Last edited by pshonore on Thu Sep 17, 2015 12:39 pm, edited 1 time in total.

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Re: August CPI released; SS COLA unlikely

Post by abuss368 » Wed Sep 16, 2015 8:26 am

pshonore wrote:BLS released the Aug CPI figures today. Right now the three month running average (June,July,Aug) for the CPI-W stands at 233.366 . The benchmark previous year average (July Aug Sept) is 234.170 . Unless next month's CPI shows about a 1% increase over August (extremely unlikely), the will be no SSI COLA for 2016.
Hi pshonore,

Thank you for providing. I did read about this today. In addition, there could be large Medicare premium increases for many retirees.

Best.
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Re: August CPI released; SS COLA unlikely

Post by cheese_breath » Wed Sep 16, 2015 8:43 am

abuss368 wrote:
pshonore wrote:BLS released the Aug CPI figures today. Right now the three month running average (June,July,Aug) for the CPI-W stands at 233.366 . The benchmark previous year average (July Aug Sept) is 234.170 . Unless next month's CPI shows about a 1% increase over August (extremely unlikely), the will be no SSI COLA for 2016.
Hi pshonore,

Thank you for providing. I did read about this today. In addition, there could be large Medicare premium increases for many retirees.

Best.
But the Hold Harmless rule should protect many of us having our Medicare premiums deducted from our SS payments. Of course those waiting until 70 to take their SS may see an increase. (I'm just sniping for fun. I know waiting to take the SS will more than offset any Medicare increases.)
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Re: August CPI released; SS COLA unlikely

Post by FactualFran » Wed Sep 16, 2015 4:38 pm

With the release of the August CPI-U, it is possible to estimate the federal income tax related adjustments for 2016. The income minimum of a tax bracket should increase about 0.5% from 2015. For someone with a filing status of Single, the 25% tax bracket should start at $37,650 instead of $37,450 (for 2015). The standard deduction should remain $6,300. The personal exemption should be $4,050 instead of $4,000 (for 2015). The maximum IRA contribution amount should remain the same.

[Edit: corrected starting taxable income of the 25% tax bracket, original post inadvertently used starting taxable income of the 28% tax bracket.]
Last edited by FactualFran on Wed Sep 16, 2015 5:16 pm, edited 1 time in total.

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Re: August CPI released; SS COLA unlikely

Post by ThisTimeItsDifferent » Wed Sep 16, 2015 4:48 pm

What does this indicate about I bond rates?

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Re: August CPI released; SS COLA unlikely

Post by Artsdoctor » Wed Sep 16, 2015 4:50 pm

Yet another period of decreasing CPI. I guess this increases the likelihood that I-bonds will offer next to nothing (or nothing) for the notes beginning in November.

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Re: August CPI released; SS COLA unlikely

Post by Trapper » Wed Sep 16, 2015 5:06 pm

Hey FactualFran,
you posted, " For someone with a filing status of Single, the 25% tax bracket should start at $91,150 instead of $90,750 (for 2015).".
Better check your facts, the 25% bracket for singles ends at $90,750. It begins at a very modest $37,451.

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Re: August CPI released; SS COLA unlikely

Post by Angst » Wed Sep 16, 2015 5:08 pm

I've never been convinced that there is a formula for the I Bond fixed rate that is entirely based on math. Regardless, at this point, I think nothing short of a robust, new "taper tantrum" is going to budge the I Bond fixed rate north of zero. We should know fairly soon.

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Re: August CPI released; SS COLA unlikely

Post by FactualFran » Wed Sep 16, 2015 5:12 pm

Trapper wrote:Hey FactualFran,
you posted, " For someone with a filing status of Single, the 25% tax bracket should start at $91,150 instead of $90,750 (for 2015).".
Better check your facts, the 25% bracket for singles ends at $90,750. It begins at a very modest $37,451.
You are correct. I copied the number from the wrong column. I'll correct the post.

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Re: August CPI released; SS COLA unlikely

Post by Uncle Pennybags » Wed Sep 16, 2015 5:23 pm

The problem with this is gasoline under $2 brought down the CPI. People on SS drive much less than others if at all.

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Re: August CPI released; SS COLA unlikely

Post by FactualFran » Wed Sep 16, 2015 5:58 pm

Uncle Pennybags wrote:The problem with this is gasoline under $2 brought down the CPI. People on SS drive much less than others if at all.
It brought down the CPI-W, used for SS benefit adjustments, more than the CPI-U. For Jul. 2015, Motor Fuel had a relative importance of 5.576 (out of 100.000) in the CPI-W and 4.253 in the CPI-U.

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Re: August CPI released; SS COLA unlikely

Post by amfox1 » Wed Sep 16, 2015 8:20 pm

Artsdoctor wrote:Yet another period of decreasing CPI. I guess this increases the likelihood that I-bonds will offer next to nothing (or nothing) for the notes beginning in November.
Not true. The formula is based on the change in CPI-U for the six month period between March and September (and then between September and March). For the five months between March and August, the change in CPI-U has been just under one percent (0.93%). It is unlikely that CPI-U will fall by enough in September to vitiate all or most of this five-month change.

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Re: August CPI released; SS COLA unlikely

Post by pshonore » Thu Sep 17, 2015 8:10 am

Am I reading the table wrong at https://www.treasurydirect.gov/indiv/re ... .htm#fixed or are all I Bonds issued after November 2002 earning a composite interest rate of 0% for the May - Oct current period ? My simple mind thinks they would at least earn their fixed rate but evidently that's not how they calculate it at the page referenced above.

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Re: August CPI released; SS COLA unlikely

Post by Uncle Pennybags » Thu Sep 17, 2015 8:26 am

pshonore wrote: My simple mind thinks they would at least earn their fixed rate but evidently that's not how they calculate it at the page referenced above.
You got a good deal; you could have been charged .08% for them to hold your money. Inflation is -.08%

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Re: August CPI released; SS COLA unlikely

Post by amfox1 » Thu Sep 17, 2015 9:36 am

pshonore wrote:Am I reading the table wrong at https://www.treasurydirect.gov/indiv/re ... .htm#fixed or are all I Bonds issued after November 2002 earning a composite interest rate of 0% for the May - Oct current period ? My simple mind thinks they would at least earn their fixed rate but evidently that's not how they calculate it at the page referenced above.
You are reading it correctly.

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Re: August CPI released; SS COLA unlikely

Post by Atilla » Thu Sep 17, 2015 9:47 am

This also means the income subject to SS tax won't increase either - correct? If so - that's great news for 2016 higher income earners.
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Re: August CPI released; SS COLA unlikely

Post by sport » Thu Sep 17, 2015 9:49 am

cheese_breath wrote: (I'm just sniping for fun. I know waiting to take the SS will more than offset any Medicare increases.)
This depends on the size of one's SS benefit. If the benefit is very small, and if one is closer to 70, it would take a long time for a one year or two year increase to overcome a large Medicare increase.

You may say "how could the benefit be so small?". Well, consider a teacher who is subject to the WEP, but has 40 quarters from odd jobs in the summer. The teacher will have a benefit, but it may be less than $100.

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Re: August CPI released; SS COLA unlikely

Post by mptfan » Thu Sep 17, 2015 11:28 am

pshonore wrote:BLS released the Aug CPI figures today. Right now the three month running average (June,July,Aug) for the CPI-W stands at 233.366 .
Please check your numbers. The CIP-W numbers for the last three months are:

June 2015 233.804
July 2015 233.806
August 2015 233.366

The average of those numbers is 233.659, not 233.366 as you indicated.

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Re: August CPI released; SS COLA unlikely

Post by antiqueman » Thu Sep 17, 2015 11:37 am

[quote="cheese_breath"][quote="abuss368"][quote="pshonore"]BLS released the Aug CPI figures today. Right now the three month running average (June,July,Aug) for the CPI-W stands at 233.366 . The benchmark previous year average (July Aug Sept) is 234.170 . Unless next month's CPI shows about a 1% increase over August (extremely unlikely), the will be no SSI COLA for 2016.[/quote]

In addition, there could be large Medicare premium increases for many retirees.


Why is there the potential for "large Medicare premium increase for many retirees" if inflation is low?

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Re: August CPI released; SS COLA unlikely

Post by rustymutt » Thu Sep 17, 2015 11:42 am

I just don't understand the CPI. Everything I purchase has gone way up, except for gasoline, which I though wasn't part of the CPI.
As when gas goes up, CPI doesn't. Food is up, utilities up, cell phone plan is up, and cost of living for me keeps going up. Can someone explain to me why CPI has gone down recently? I really want to know, and understand this.

:oops:
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Re: August CPI released; SS COLA unlikely

Post by FactualFran » Thu Sep 17, 2015 12:26 pm

rustymutt wrote:I just don't understand the CPI. Everything I purchase has gone way up, except for gasoline, which I though wasn't part of the CPI.
Gasoline is part of the CPI. The weight of the price of gasoline, and the weights of other categories, in the CPI-U is in http://www.bls.gov/news.release/cpi.t01.htm web page. See the the CPI Frequently Asked Question web page at http://www.bls.gov/cpi/cpifaq.htm to get an understanding of what the CPI is.

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Re: August CPI released; SS COLA unlikely

Post by pshonore » Thu Sep 17, 2015 12:38 pm

mptfan wrote:
pshonore wrote:BLS released the Aug CPI figures today. Right now the three month running average (June,July,Aug) for the CPI-W stands at 233.366 .
Please check your numbers. The CIP-W numbers for the last three months are:

June 2015 233.804
July 2015 233.806
August 2015 233.366

The average of those numbers is 233.659, not 233.366 as you indicated.
Thanks for the correction. My Spread sheet was trying to do too much. Correct result is still below the benchmark (234.242) unless September number is a big jump.

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Re: August CPI released; SS COLA unlikely

Post by mptfan » Thu Sep 17, 2015 1:10 pm

rustymutt wrote:I just don't understand the CPI. Everything I purchase has gone way up, except for gasoline, which I though wasn't part of the CPI.
As when gas goes up, CPI doesn't. Food is up, utilities up, cell phone plan is up, and cost of living for me keeps going up. Can someone explain to me why CPI has gone down recently? I really want to know, and understand this.
I am not qualified to fully explain the components of the CPI and why it has gone down somewhat recently, but I would like to offer some observations about the general cost of living. I agree that many things have gone up, but I also have observed that some expenses (at least for me) have gone down. Everyone has their own experience, but I would like to offer some observations from my personal experience of how some of my personal expenses have gone down.

1) The price of gas has gone down for me. Not only has the price of a gallon of gas gone down, but I recently bought a new car, and my new car has a much more fuel efficient engine, so not only do I pay less for a gallon of gas, but I also use less gas, so my overall gas expense has gone down. For someone who drives quite a bit, this is a significant savings.

2) The price of personal computing has gone down for me. I remember paying over a $1,000 for a desktop computer not too many years ago, whereas now I just purchased a new Chromebook for less than $400 that does almost everything I need a computer to do. I think part of the explanation is that computers are getting faster and cheaper, but it is also because the price of my Chromebook does not include the licensing fee that has to be paid to Microsoft to use Windows (Chromebooks do not use Windows). I also remember paying several hundred dollars for the Microsoft Office suite, whereas now I can do everything I need using Google Apps which are free. I also remember paying for physical storage to back up and store my files, like CDs, or thumb drives, or portable hard drives, whereas now I back up everything in the cloud, for free. Also, printers are significantly cheaper now than they used to be.

3) The price of electricity has gone down for me. I think it is because I have been replacing older appliances and light fixtures with new and more efficient fixtures.

4) The price of television content has gone down for me. I used to pay for cable tv, but I stopped doing that. I now get free tv service using a regular rabbit ear antennae that is HD quality video and audio, and I supplement that with video content that is provided over the internet, including Netflix and Amazon Prime. The total cost of those services is much less than what I was paying before for cable tv.

5) The price of long distance telephone usage has gone down for me. I have family that live outside of the country, and I used to pay per minute in order to talk to them on the phone. The per minute cost was not too much if I used a calling card, but I still had to pay, and it was a PITA to keep getting calling cards and punch in lots of numbers every time I made a phone call. That cost has been eliminated now thanks to internet calling with apps like WhatsApp and Google Hangouts.

6) The price of TVs has gone down. I can remember when a 42 inch widescreen TV was well over $1,000, and now you can get the same size TV with much better quality for less than $400.

7) The price of a variety of items has gone down and the ability to comparison shop has become much easier thanks to Amazon and other online merchants. This is hard to quantify, but I have no doubt that my general expenses have gone down as a result.

8) Some travel expenses have gone down for me. Thanks to sites like airbnb I can afford to rent apartments when I travel that actually cost less than comparable hotel rooms in the same area. Having an apartment also gives me the option of preparing a meal in the kitchen in the apartment or keeping snacks in the refrigerator that keep the food costs down when I travel that would not be possible or nearly as convenient to do in a hotel room. Also, thanks to Uber, the cost of local taxi transportation has gone down.

(I started a separate thread on this subject called "Cost of living expenses that have gone down.")
Last edited by mptfan on Thu Sep 17, 2015 1:50 pm, edited 8 times in total.

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Re: August CPI released; SS COLA unlikely

Post by frugalecon » Thu Sep 17, 2015 1:19 pm

Atilla wrote:This also means the income subject to SS tax won't increase either - correct? If so - that's great news for 2016 higher income earners.
I don't believe this is true. (See http://www.ssa.gov/policy/docs/policybr ... 11-02.html) It appears that changes in average wages determine changes in the income cap. According to data at the BLS website, it appears that hourly average earnings have increased by approximately 2.2% year over year, though I am not sure if that is the data series that is used to adjust the income cap.

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Re: August CPI released; SS COLA unlikely

Post by dm200 » Thu Sep 17, 2015 6:21 pm

mptfan wrote:
rustymutt wrote:I just don't understand the CPI. Everything I purchase has gone way up, except for gasoline, which I though wasn't part of the CPI.
As when gas goes up, CPI doesn't. Food is up, utilities up, cell phone plan is up, and cost of living for me keeps going up. Can someone explain to me why CPI has gone down recently? I really want to know, and understand this.
I am not qualified to fully explain the components of the CPI and why it has gone down somewhat recently, but I would like to offer some observations about the general cost of living. I agree that many things have gone up, but I also have observed that some expenses (at least for me) have gone down. Everyone has their own experience, but I would like to offer some observations from my personal experience of how some of my personal expenses have gone down.
1) The price of gas has gone down for me. Not only has the price of a gallon of gas gone down, but I recently bought a new car, and my new car has a much more fuel efficient engine, so not only do I pay less for a gallon of gas, but I also use less gas, so my overall gas expense has gone down. For someone who drives quite a bit, this is a significant savings.
2) The price of personal computing has gone down for me. I remember paying over a $1,000 for a desktop computer not too many years ago, whereas now I just purchased a new Chromebook for less than $400 that does almost everything I need a computer to do. I think part of the explanation is that computers are getting faster and cheaper, but it is also because the price of my Chromebook does not include the licensing fee that has to be paid to Microsoft to use Windows (Chromebooks do not use Windows). I also remember paying several hundred dollars for the Microsoft Office suite, whereas now I can do everything I need using Google Apps which are free. I also remember paying for physical storage to back up and store my files, like CDs, or thumb drives, or portable hard drives, whereas now I back up everything in the cloud, for free. Also, printers are significantly cheaper now than they used to be.
3) The price of electricity has gone down for me. I think it is because I have been replacing older appliances and light fixtures with new and more efficient fixtures.
4) The price of television content has gone down for me. I used to pay for cable tv, but I stopped doing that. I now get free tv service using a regular rabbit ear antennae that is HD quality video and audio, and I supplement that with video content that is provided over the internet, including Netflix and Amazon Prime. The total cost of those services is much less than what I was paying before for cable tv.
5) The price of long distance telephone usage has gone down for me. I have family that live outside of the country, and I used to pay per minute in order to talk to them on the phone. The per minute cost was not too much if I used a calling card, but I still had to pay, and it was a PITA to keep getting calling cards and punch in lots of numbers every time I made a phone call. That cost has been eliminated now thanks to internet calling with apps like WhatsApp and Google Hangouts.
6) The price of TVs has gone down. I can remember when a 42 inch widescreen TV was well over $1,000, and now you can get the same size TV with much better quality for less than $400.
7) The price of a variety of items has gone down and the ability to comparison shop has become much easier thanks to Amazon and other online merchants. This is hard to quantify, but I have no doubt that my general expenses have gone down as a result.
8) Some travel expenses have gone down for me. Thanks to sites like airbnb I can afford to rent apartments when I travel that actually cost less than comparable hotel rooms in the same area. Having an apartment also gives me the option of preparing a meal in the kitchen in the apartment or keeping snacks in the refrigerator that keep the food costs down when I travel that would not be possible or nearly as convenient to do in a hotel room. Also, thanks to Uber, the cost of local taxi transportation has gone down.
(I started a separate thread on this subject called "Cost of living expenses that have gone down.")
I agree with most of the points made above.

As a "numbers" person, as well as some knowledge/experience in following the CPI (or rather various versions of the 'CPI'), I believe this entire issue is "complex". I also believe that almost all of us (myself included) tend to notice price increases more than price decreases. For food purchases, as an example, I notice that the very same (or similar) purchases in the grocery store have gone up over the last few years (every year).

In our case, one item that has gone down is my wife's health insurance (I am on Medicare). Even before the credit/subsidy - because of the ACA (and her age), the monthly cost dropped about 20-25%.

A real puzzle, as well, is how to "count" purchases of "things" that did not exist just a few short years ago. How do you figure cost of cell phones, then smart phones or iPads ??

Some degree (subject of big debate) of price increases is due to improvements in the product. Today's automobiles, for example, have features that did not exist and, in my opinion, most autos today will last longer than most of the autos of decades ago.

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Re: August CPI released; SS COLA unlikely

Post by Artsdoctor » Thu Sep 17, 2015 10:02 pm

amfox1 wrote:
Artsdoctor wrote:Yet another period of decreasing CPI. I guess this increases the likelihood that I-bonds will offer next to nothing (or nothing) for the notes beginning in November.
Not true. The formula is based on the change in CPI-U for the six month period between March and September (and then between September and March). For the five months between March and August, the change in CPI-U has been just under one percent (0.93%). It is unlikely that CPI-U will fall by enough in September to vitiate all or most of this five-month change.
I believe we have different definitions of "next to nothing."

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Re: August CPI released; SS COLA unlikely

Post by jebmke » Fri Sep 18, 2015 7:22 pm

mptfan wrote:
rustymutt wrote:I just don't understand the CPI. Everything I purchase has gone way up, except for gasoline, which I though wasn't part of the CPI.
As when gas goes up, CPI doesn't. Food is up, utilities up, cell phone plan is up, and cost of living for me keeps going up. Can someone explain to me why CPI has gone down recently? I really want to know, and understand this.
I am not qualified to fully explain the components of the CPI and why it has gone down somewhat recently, but I would like to offer some observations about the general cost of living. I agree that many things have gone up, but I also have observed that some expenses (at least for me) have gone down. Everyone has their own experience, but I would like to offer some observations from my personal experience of how some of my personal expenses have gone down.

1) The price of gas has gone down for me. Not only has the price of a gallon of gas gone down, but I recently bought a new car, and my new car has a much more fuel efficient engine, so not only do I pay less for a gallon of gas, but I also use less gas, so my overall gas expense has gone down. For someone who drives quite a bit, this is a significant savings.

2) The price of personal computing has gone down for me. I remember paying over a $1,000 for a desktop computer not too many years ago, whereas now I just purchased a new Chromebook for less than $400 that does almost everything I need a computer to do. I think part of the explanation is that computers are getting faster and cheaper, but it is also because the price of my Chromebook does not include the licensing fee that has to be paid to Microsoft to use Windows (Chromebooks do not use Windows). I also remember paying several hundred dollars for the Microsoft Office suite, whereas now I can do everything I need using Google Apps which are free. I also remember paying for physical storage to back up and store my files, like CDs, or thumb drives, or portable hard drives, whereas now I back up everything in the cloud, for free. Also, printers are significantly cheaper now than they used to be.

3) The price of electricity has gone down for me. I think it is because I have been replacing older appliances and light fixtures with new and more efficient fixtures.

4) The price of television content has gone down for me. I used to pay for cable tv, but I stopped doing that. I now get free tv service using a regular rabbit ear antennae that is HD quality video and audio, and I supplement that with video content that is provided over the internet, including Netflix and Amazon Prime. The total cost of those services is much less than what I was paying before for cable tv.

5) The price of long distance telephone usage has gone down for me. I have family that live outside of the country, and I used to pay per minute in order to talk to them on the phone. The per minute cost was not too much if I used a calling card, but I still had to pay, and it was a PITA to keep getting calling cards and punch in lots of numbers every time I made a phone call. That cost has been eliminated now thanks to internet calling with apps like WhatsApp and Google Hangouts.

6) The price of TVs has gone down. I can remember when a 42 inch widescreen TV was well over $1,000, and now you can get the same size TV with much better quality for less than $400.

7) The price of a variety of items has gone down and the ability to comparison shop has become much easier thanks to Amazon and other online merchants. This is hard to quantify, but I have no doubt that my general expenses have gone down as a result.

8) Some travel expenses have gone down for me. Thanks to sites like airbnb I can afford to rent apartments when I travel that actually cost less than comparable hotel rooms in the same area. Having an apartment also gives me the option of preparing a meal in the kitchen in the apartment or keeping snacks in the refrigerator that keep the food costs down when I travel that would not be possible or nearly as convenient to do in a hotel room. Also, thanks to Uber, the cost of local taxi transportation has gone down.

(I started a separate thread on this subject called "Cost of living expenses that have gone down.")
Same here for many things. Electric rate went down (more conversion from coal to gas on our grid), gasoline, cell phone (no carrier change). Even our real estate taxes went down this year after holding flat for 3-4 years. Not sure why RE taxes went down. The governor cut the tolls on the Chesapeake Bay bridge from something like $6 to $4. I don't track everything we spend on but my "wet finger" estimate is flattish.
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Re: August CPI released; SS COLA unlikely

Post by Phineas J. Whoopee » Sat Sep 19, 2015 3:26 pm

rustymutt wrote:I just don't understand the CPI. Everything I purchase has gone way up, except for gasoline, which I though wasn't part of the CPI.
As when gas goes up, CPI doesn't. Food is up, utilities up, cell phone plan is up, and cost of living for me keeps going up. Can someone explain to me why CPI has gone down recently? I really want to know, and understand this.

:oops:
If I may:

1) Food and fuel are components of headline CPI, the main number. There's a second measure, meant for use in economic forecasting, called core CPI, which indeed leaves out food and fuel, not because they're unimportant, but because their prices fluctuate so wildly it's hard to analyze trends. Federal benefits and taxes that adjust based on CPI use the fully-inclusive headline version.

2) There are two formulas for CPI: CPI-U, the consumer price index for all urban consumers; and CPI-W, the index for urban wage earners and clerical workers.

3) CPI is calculated using a standard basket of goods and services. The all urban and urban wage earners and clerical workers baskets differ, but not by very much.

4) Any individual's basket of purchases might be close to or far away from that used for CPI calculations. There is no Consumer Price Index for rustymutt any more than there's a Consumer Price Index for Phineas J. Whoopee. It wouldn't be hard to imagine a consumer whose expenses are dominated by college tuition and medical costs, even as they walk or ride the bus.

5) Neither the baskets, nor the raw data on prices, nor the methodology are secret. The Bureau of Labor Statistics publishes them on its website. Anybody with enough time and desire can run the calculations for themselves.

6) MIT's Billion Prices Project's US results aren't far off from CPI.

7) The Bureau of Economic Analysis, a part of the Department of Commerce, publishes its own index, the Personal Consumption Expenditures price index, in both headline and core forms, which uses a different methodology and usually comes in somewhat below CPI. The Fed prefers to use the PCE for forecasting purposes. And finally -

8) I concur with FactualFran that everybody with an interest should read the BLS's CPI Frequently Asked Questions page. It may look a little long but is fairly quick to get through.

Hope that's helpful to somebody.

PJW

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Re: August CPI released; SS COLA unlikely

Post by Lacrab » Sun Sep 20, 2015 9:35 am

I believe this entire issue is "complex". I also believe that almost all of us (myself included) tend to notice price increases more than price decreases. For food purchases, as an example, I notice that the very same (or similar) purchases in the grocery store have gone up over the last few years (every year).


+1
This space has been intentionally left blank, but required writing to notify you, so...yeah

denovo
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Re: August CPI released; SS COLA unlikely

Post by denovo » Sun Sep 20, 2015 9:45 am

Lacrab wrote:
I believe this entire issue is "complex". I also believe that almost all of us (myself included) tend to notice price increases more than price decreases. For food purchases, as an example, I notice that the very same (or similar) purchases in the grocery store have gone up over the last few years (every year).


+1
One of the most remarkable declines that has gone relatively unnoticed is the price of natural gas.

Image

That is why home heating and electricity costs have gone down for so many
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Uncle Pennybags
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Re: August CPI released; SS COLA unlikely

Post by Uncle Pennybags » Sun Sep 20, 2015 12:00 pm

denovo wrote:One of the most remarkable declines that has gone relatively unnoticed is the price of natural gas.
I notice it every month. My government subsidized furnace and hot water heater have paid for themselves in the three years I've had them. Sitting on my ocean of natural gas I laugh at the "polar vortex".

denovo
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Re: August CPI released; SS COLA unlikely

Post by denovo » Sun Sep 20, 2015 12:04 pm

Uncle Pennybags wrote:
denovo wrote:One of the most remarkable declines that has gone relatively unnoticed is the price of natural gas.
I notice it every month. My government subsidized furnace and hot water heater have paid for themselves in the three years I've had them. Sitting on my ocean of natural gas I laugh at the "polar vortex".

I take it you are not the one in your household in charge of shoveling snow off the driveway. :D
"Don't trust everything you read on the Internet"- Abraham Lincoln

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Uncle Pennybags
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Re: August CPI released; SS COLA unlikely

Post by Uncle Pennybags » Sun Sep 20, 2015 12:16 pm

denovo wrote:I take it you are not the one in your household in charge of shoveling snow off the driveway. :D
About 20,000 years ago my driveway was under a mile and a half of snow. It could be worse.

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Re: August CPI released; SS COLA unlikely

Post by The Wizard » Sun Sep 20, 2015 12:55 pm

Uncle Pennybags wrote:The problem with this is gasoline under $2 brought down the CPI. People on SS drive much less than others if at all.
Horse business.
If you meant to say retired people with only SS for income, I would certainly agree.
But as one in his third year of retirement who has been eligible for SS but hasn't claimed yet, I've been driving MORE per year, both personal vehicles and rental cars.
So low fuel prices are much appreciated...
Attempted new signature...

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Uncle Pennybags
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Re: August CPI released; SS COLA unlikely

Post by Uncle Pennybags » Sun Sep 20, 2015 1:19 pm

The Wizard wrote: I've been driving MORE per year,
That's great, report back in 20 years. :wink:

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pshonore
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It's official No SS COLA [Social Security Cost-of-Living Adjustment]

Post by pshonore » Thu Oct 15, 2015 8:07 am

[Thread merged into here, see below. --admin LadyGeek]

October CPI-U came in at 232.661 (that's a 0.4% drop from the three month measuring period last year and a 0.2% drop from last month.)

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Jerry55
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Re: It's official No SS COLA

Post by Jerry55 » Thu Oct 15, 2015 8:33 am

And for those of us CSRS Pensioners, same thing. No C.O.L.A.

Shall we refer to it as "The Un-Cola" now ??? :happy
Retired CSRS on 12/19/2012 @ age 57 w/39 years | Good Bye Tension, Hello Pension !!!

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ruralavalon
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Re: It's official No SS COLA

Post by ruralavalon » Thu Oct 15, 2015 8:39 am

Jerry55 wrote:And for those of us CSRS Pensioners, same thing. No C.O.L.A.

Shall we refer to it as "The Un-Cola" now ??? :happy
Made me laugh :D :D :D .

It's good to start the day with a laugh.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

22twain
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Re: It's official No SS COLA

Post by 22twain » Thu Oct 15, 2015 8:47 am

I'm waiting for the National Average Wage Index (NAWI) for 2014 which should be out Real Soon Now. 2014 is my SS "indexing year" so this will nail down my initial PIA for next year (age 62). Then I can start watching the COLAs until age 70 which is when I plan to start collecting.
My investing princiPLEs do not include absolutely preserving princiPAL.

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Re: It's official No SS COLA

Post by mptfan » Thu Oct 15, 2015 10:04 am

The National Average Wage Index for 2014 is $46,481.52. That is 3.55% higher than the wage index for 2013.

https://www.ssa.gov/oact/cola/AWI.html

LadyIJ
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Re: It's official No SS COLA

Post by LadyIJ » Thu Oct 15, 2015 12:10 pm

So what does this mean to people who are just turning 62 this year? I know it means DH won't get a raise, but for me? I don't want to take until 70 -- does it affect the FRA and the amount ss online statements project for 70?

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Toons
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Re: It's official No SS COLA

Post by Toons » Thu Oct 15, 2015 12:16 pm

"The reason? A decline in inflation caused by falling gas prices."

Get your calculator out.
How many gallons of gasoline are you using.
How much are you "saving" each time you fill up.
Comparing to prices when they were at there highest.
What are you doing with the extra monies?? 8-)
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

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jjustice
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Re: It's official No SS COLA

Post by jjustice » Thu Oct 15, 2015 12:27 pm

Aren't you glad that there is only an up-side COLA?

John

mptfan
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Re: It's official No SS COLA

Post by mptfan » Thu Oct 15, 2015 12:40 pm

Toons wrote:Get your calculator out.
How many gallons of gasoline are you using.
How much are you "saving" each time you fill up.
Comparing to prices when they were at there highest.
What are you doing with the extra monies?? 8-)
Here are my actual spending numbers for gas since 2010:

2010 $3,026
2011 $3,007
2012 $2,239
2013 $2,826
2014 $2,423
2015 $1,688 (this is projected based on 1,266 through the end of September)

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Toons
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Re: It's official No SS COLA

Post by Toons » Thu Oct 15, 2015 12:47 pm

mptfan wrote:
Toons wrote:Get your calculator out.
How many gallons of gasoline are you using.
How much are you "saving" each time you fill up.
Comparing to prices when they were at there highest.
What are you doing with the extra monies?? 8-)
Here are my actual spending numbers for gas since 2010:

2010 $3,026
2011 $3,007
2012 $2,239
2013 $2,826
2014 $2,423
2015 $1,688 (this is projected based on 1,266 through the end of September)
+5 :D
Perfect,,we think alike
My "fuel" is categorized in Quicken.
I invested the "savings" in Lifestrategy Conservative Growth"
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

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gardemanger
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Re: It's official No SS COLA

Post by gardemanger » Thu Oct 15, 2015 12:54 pm

I don't have a car. Bus fare has not changed. Taxi fares don't seem to have changed. (Ever notice that when taxis, airport shuttles, etc. start imposing a "fuel surcharge" during times of high gas prices, they do not subsequently remove the surcharges even if gas prices go back down?)

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Re: It's official No SS COLA

Post by 22twain » Thu Oct 15, 2015 1:12 pm

mptfan wrote:The National Average Wage Index for 2014 is $46,481.52. That is 3.55% higher than the wage index for 2013.

https://www.ssa.gov/oact/cola/AWI.html
A Google search for "National Average Wage Index" gave me that page as the first hit, but Google's descriptive "snippet" for it still reads, "The national average wage index for 2013 is 44,888.16. The index is 1.28 percent higher than the index for 2012." So I didn't click the link. It must have been updated very recently.
My investing princiPLEs do not include absolutely preserving princiPAL.

mptfan
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Re: It's official No SS COLA

Post by mptfan » Thu Oct 15, 2015 1:17 pm

22twain wrote:A Google search for "National Average Wage Index" gave me that page as the first hit, but Google's descriptive "snippet" for it still reads, "The national average wage index for 2013 is 44,888.16. The index is 1.28 percent higher than the index for 2012." So I didn't click the link. It must have been updated very recently.
I see that, I just did the same search and I see the same google snippet under the first search result. It is a good lesson learned... do not rely on the google snippet, go to the source for the most updated information.

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Re: It's official No SS COLA

Post by Alan S. » Thu Oct 15, 2015 2:26 pm

The potential COLA for 2017 will also start underwater because the COLA for that year will be determined by the CPI W change from the 3rd Q 2014, not from the lower 2015 3rd Q average. So the first inflation starting right now will be applied to catching up to that 2014 CPI W.

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Re: It's official No SS COLA

Post by john94549 » Thu Oct 15, 2015 6:51 pm

As a retiree, I willingly accept flat to no (inflation). The Fed might hate it, but I love it. The last few years, COLAs have been quite modest, in any event. I seem to recall last year's COLA was in the neighborhood of 1.6%, which translated (for me) to about $32/mo, before taxes. My wife (drawing spousal) maybe $20/mo.

I'm quite happy these days with the concept of "2%". Two-percent growth, 2% dividends, and (on average) 2% on my CDs and bond funds. I have quite modest expectations.

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