Do Social Security benefits adjust with inflation?

Social Security benefits are indeed adjusted for inflation through Cost-of-Living Adjustments (COLA). This mechanism is designed to ensure that the purchasing power of Social Security recipients is not eroded by inflation over time. Each year, the Social Security Administration reviews economic indicators, particularly the Consumer Price Index (CPI), to determine whether an adjustment is necessary.

When inflation rises, the COLA ensures that beneficiaries receive a bump in their monthly payments to reflect these changes in the cost of living. This adjustment helps recipients keep up with rising prices, making it a vital component of the Social Security program. Thus, the answer regarding the benefits increasing with COLA accurately reflects this important regulatory aspect of how Social Security operates in relation to inflation.