Many seniors end up relying heavily on Social Security to make ends meet in retirement. Even those who come into their senior years with a decent amount of savings often need those benefits to stay afloat.

The fact that Social Security benefits are guaranteed for life is an important thing. The monthly withdrawals you take from your IRA or 401(k) plan might vary based on factors like how well the market performs. But Social Security guarantees your monthly benefit for life, regardless of how the market is doing.

But while that guaranteed income is essential for so many seniors, there's yet another feature of Social Security that makes it such a crucial program. And it's something retirees should be grateful for.

Protection against inflation

Many of us are familiar with inflation in its current context of being out of control. But most of the time, inflation is far more moderate.

Social Security cards.

Image source: Getty Images.

Over time, the general cost of living tends to rise, and the value of a dollar tends to erode. The great thing about Social Security is that it accounts for that via its annual cost-of-living adjustments, or COLAs.

Each year, Social Security benefits are subject to a COLA based on recent inflation data. Now to be clear, this doesn't mean those benefits get a lift every year. If inflation remains flat, benefits don't rise. Or, they may rise to a fairly negligible degree. Such has been the case on more than one occasion over the past 15 years.

But when inflation soars, Social Security benefits tend to get a nice boost. That's what happened going into 2022 when benefits got a 5.9% COLA. And while we don't know what 2023's COLA looks like just yet -- we'll have to sit tight until October until that announcement is made -- experts are calling for an even more substantial boost based on recent inflation levels.

It's this very protection that allows Social Security to live up to the "security" part of its name. Granted, investments in an IRA or 401(k) may grow in a manner that keeps up with or outpaces inflation. But that's not guaranteed to happen.

Moreover, IRA and 401(k) balances can decline from year to year not just due to factors like withdrawals and required minimum distributions but also due to market conditions. Social Security helps make up for that.

With that said, Social Security has long been criticized for the way it calculates COLAs -- namely, that it doesn't use the right metrics to determine how much of a boost benefits should get. And the nonpartisan Senior Citizens League reports that seniors on Social Security have been consistently losing buying power through the years due to inadequate COLAs.

That means Social Security may need a bit of an overhaul with regard to COLA calculations, and advocates and lawmakers may increasingly push for that in the coming years. But all told, the fact that benefits are designed to adjust for inflation is an important feature of the program that should definitely not be overlooked.