You may already know that this year's average monthly Social Security payment stands at a respectable $1,976. But that wasn't always the case. This number is regularly adjusted to account for inflation. It's called a cost-of-living adjustment, or COLA for short.
This regular increase begs the question: What was the typical Social Security check worth back in, say, 1984?
The number
In 1984, the average Social Security check was a mere $460.57 per month.
It's not quite as alarmingly low as it seems to be on the surface. Based on the U.S. Census Bureau's inflation data that ultimately determines any given year's COLA, that amount would be worth right around $1,436 in today's dollars.
Yes, Social Security's beneficiaries have, on average, technically "beaten" inflation!
Just don't get too excited. The Senior Citizens League argues that since 2010, the typical Social Security beneficiary has actually lost on the order of $370 worth of monthly buying power. Although the math based on the Census Bureau's numbers doesn't show quite this much of a setback in buying power, the agency's CPI (consumer price inflation) calculator does suggest that the cost-of-living adjustments over the course of the past 15 years truly haven't quite kept pace with overall price increases. Things have proven particularly costly for older Americans, who may end up spending more of their income on increasingly expensive healthcare than younger taxpayers do.
Plan beyond these benefits
How much bigger will Social Security's average payment be 40 years from now? It's difficult to say. But it should still more or less continue growing in step with inflation, even if it doesn't quite fully keep up with rising costs of living.
Of course, Social Security was never intended to serve as the entirety of anyone's income in retirement. Regardless of how big or small your Social Security benefits are, you'll still want to make a point of growing your own retirement nest egg.
