To: STATE EDITORS

Contact: Michelle Plasari of RetireSafe, +1-703-766-6360

RESTON, Va.,Oct. 16 /PRNewswire-USNewswire/ -- On the announcement that seniors will receive a 5.8% Social Securitycost-of-living adjustment (COLA) beginning in January of 2009, RetireSafe urged Congress to take into account the actual rise in seniors cost-of living on an ongoing basis and adopt a fair way of calculating Social Security COLAs every year.

The 5.8% increase highlights the fact that seniors continue to fall further behind in their annual COLAs due to the method the government uses to calculate them. This years COLA was 2.3%. The disparity between that and next years 5.8% increase starkly illustrates how far seniors have fallen behind in just one year. An overwhelming majority of seniors say their annual boost simply is not increasing as rapidly as other costs. Older Americans have seen double digit increases in the cost of things like health care, energy, and food, and high inflation continues to erode the standard of living of seniors struggling each month on fixed incomes, said RetireSafe President Michelle Plasari.

The reason COLAs dont match most seniors inflation experience has to do with the way the government calculates the increase. The Social Security COLAs are calculated using the Consumer Price Index for Workers (CPI-W). That index specifically excludes the things seniors spend the most on. The result? COLAs tend to grow more slowly than they would otherwise, especially over time.

Since 1983, the Bureau of Labor statistics has maintained an experimental index that better tracks the senior market basket -- the CPI-E. RetireSafe believes that seniors would receive a higher and more adequate COLA over their retirement if the government were to calculate the COLA every year by using this senior-specific price index, said Plasari.

The problem with the COLA is that it is calibrated for the wrong people using the wrong formula, according to Plasari. This is no way to treat our seniors, who are struggling to make ends meet every day. Seniors need fairness and a guarantee from Congress that their benefits will continue to keep up with their cost of living, concluded Plasari.

RetireSafe is a grassroots advocacy organization dedicated to preserving the options and benefits of older Americans. RetireSafe promotes dynamic solutions to Americas retirement security challenges and is dedicated to preserving and enhancing the options, benefits, and lives of older Americans. To learn more visit www.RetireSafe.org.

SOURCE RetireSafe

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