Hi Larry. Given that (1) all Social Security COLA increases occurring after a person turns 62 are added to their Social Security retirement benefit rate, and (2) the indexes used on social security earnings becomes a constant 1.0 at age 60, then is it correct to conclude that someone who becomes 62 in say December of 2023 unfortunately missed out on two of the best consecutive adjustments in recent history (namely the 5.9% COLA of 2022 and the 8.7% COLA of 2023 (a combined 15% increase)? Is this just an unfortunate fact of timing that, or am I missing something?

Hi. It's certainly true that Social Security retirement benefit rates for people born after January 1 1961 won't include the the recent 5.9% & 8.7% cost of living (COLA) increases, but on the other hand their earnings will be indexed at a higher rate than people born prior to January 2 1961. Those higher indexed earnings amounts will certainly offset at least some of the COLA increases that they missed out on for years prior to the year they reached age 62.

For example, people born in 1961 will receive credit for 1.0889195 times the amount that they actually earned in the year 2020 when their Social Security retirement benefit rate is calculated, whereas people born in 1960 or earlier will only receive credit for their actual 2020 earnings. The following chart shows the yearly indexing factors used to calculate Social Security retirement benefit rates for each year of birth. Note, for instance, that the indexing rates are higher for all years before 2021 for people turning 62 in 2023 than they are for people who turned age 62 in 2022. https://www.ssa.gov/cgi-bin/awiFactors.cgi. Thus, even though people turning 62 in 2022 did receive the recent 8.7% COLA increase, their starting benefit rate was calculated using lower indexing factors than those used for people born in 2023.

Best, Jerry