Missed Nvidia in 2009? This Rare Signal Is Flashing Again.<\/strong>\u00a0In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia.\u00a0For the first time in years, that same “Total Conviction” signal is flashing for a company 1\/100th the size of Nvidia.\u00a0Continue \u00bb<\/strong><\/a> <\/p>\n While any increase is nice, it’s important to remember that $2,078 is before taxes (if you owe taxes on benefits due to your combined annual income). <\/p>\n While COLAs are rarely considered bad news, they’re not always good news. Here’s why: <\/p>\n They reflect a higher cost of living:<\/strong> What so many Social Security recipients find frustrating is that their COLA increase appears to disappear before they have a chance to enjoy it. COLAs are triggered when overall consumer prices rise, and overall consumer prices don’t stop rising once COLAs are announced. A larger COLA for 2027 simply mirrors higher inflation and means that you’re also paying more for housing, healthcare in retirement<\/a>, and groceries. <\/p>\n<\/li>\n They may affect taxes and benefits:<\/strong> It’s possible that a larger-than-usual COLA will be just enough to push a recipient over an income threshold for taxation and affect eligibility for some income-based programs. <\/p>\n<\/li>\n They add strain to an already fragile program:<\/strong> Although Congress has recently begun to take seriously shoring up the Social Security trust fund, fear remains that it will run dry in 2032 and that benefits will be cut by 22%. A COLA in the upper 3% range worsens an already large long-term funding gap and brings the program closer to the brink. <\/p>\n<\/li>\n<\/ul>\n How to make the most of your COLA — no matter what happens <\/p>\n Let’s say that you end up with an additional $50 per month after paying higher taxes, higher prices at the pump, and other recently increased expenses. While it may seem disappointing, there’s no reason you can’t make the most of it. For example, <\/p>\n Tuck it away in a special interest-bearing account you can draw from to pay higher-than-expected healthcare costs or medical supplies. <\/p>\n<\/li>\n If you’re carrying any high-interest debt, use the money to chip away at the balance. No matter how much money you’re working with, using the debt snowball or avalanche method can help you pay off debt faster and cut down how much you pay in interest. <\/p>\n<\/li>\n Make small repairs around the house to save money in the long term. For example, if your home gets drafty in the winter, put the funds toward sealing windows and doors or adding insulation to the attic or basement. <\/p>\n<\/li>\n If you don’t need the money to pay bills, open a low-cost index fund or exchange-traded fund and let it grow. <\/p>\n<\/li>\n<\/ul>\n No matter how much you end up with in 2027, it’s possible to put it to work for you. <\/p>\n The\u00a0$23,760\u00a0Social Security bonus most retirees completely overlook <\/p>\n If you’re like most Americans, you’re a few years (or more) behind on your retirement savings. But a handful of little-known\u00a0“Social Security secrets”<\/strong><\/a> could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $23,760 more<\/strong>… each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we’re all after. <\/p>\n Many Americans leave money on the table in retirement. Learn more about these retirement strategies and more, available when you join Stock Advisor. <\/p>\n View the “Social Security secrets” \u00bb<\/strong><\/a> <\/p>\n The Motley Fool has a disclosure policy<\/a>. <\/p>\n<\/a> Image source: Getty Images. Why COLAs aren’t purely good news <\/p>\n
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