Millions of Americans depend on Social Security payments to make ends meet. Retired workers are the largest group of beneficiaries, but children, spouses and disabled individuals may also receive these benefits from the government.
While Social Security benefits are initially calculated using a worker’s earnings record, monthly payments would quickly lose purchasing power if they never changed. To prevent that from happening, legislation enacted in 1973 instituted annual cost-of-living adjustments, which began in 1975.
