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How Well Are Social Security Recipients Protected from Inflation?

How Well Are Social Security Recipients Protected from Inflation?

Chapter:
(p.119) 3 How Well Are Social Security Recipients Protected from Inflation?
Source:
Investigations in the Economics of Aging
Author(s):
Gopi Shah GodaJohn B. ShovenSita Nataraj Slavov
Publisher:
University of Chicago Press
DOI:10.7208/chicago/9780226903163.003.0004

This chapter, which examines how well Social Security recipients are protected from inflation, shows that Social Security benefits may not be as safe from inflation as is commonly believed. Because medical costs have been rising over time, and because the elderly spend a larger fraction of their income on medical care than workers do, the Consumer Price Index for Urban Wage Earners and Clerical Workers does not properly reflect the inflation experience of Social Security beneficiaries. A commentary is included at the end of the chapter.

Keywords:   retirees, inflation, Medicare, health care costs, Social Security benefits, medical care

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