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Social Security Pay Raise ?? Inflation ?

Growing Optimism!

Good News for Social Security Recipients!

Why are Bond Yields so Low?

“Americans’ Life Ratings Reach Record High” is the headline from a Gallup survey.   Gallup’s Life Evaluation Index reported that 59.2% of Americans in June 2021 say they are thriving.  This is the highest rating during the last 13 years.   The previous high was 57.3% in September 2017 and the low of 46.4% was in April 2020 during the COVID induced recession.   (1)

If you are receiving a Social Security check, get ready for a pay raise in 2022.  Although the final decision is not made until October of 2021, it's now projected that benefits will increase 6.1% in 2022, up from the 4.7% forecast just two months ago. That would be the most significant increase since 1983. (2)

It’s all about inflation. Social Security cost of living adjustments (COLA) are based on the consumer price index, which rose 5.4% in June — its largest 12-month increase since 2008.

With all the attention given to inflation, stock prices at record highs, and job reports, it’s been easy to overlook the remarkable move in the bond market during the past few months.  The yield on the 10-year treasury closed at 1.24% on Friday, July 31, down from its 2021 high of 1.74% in late March.  (3)  What’s behind the quiet fall in bond yields?

One explanation may be that reopening sentiment has turned a bit more cautious as the Delta variant of COVID-19 spreads globally. Another view is that overseas investors are buying Treasuries, effectively lowering yields.  Still another school of thought says it's due to declining inflation concerns. Or maybe it's simply more money finding its way into bonds. (4,5,6)  And why would more money be going to bonds with yields at low levels?

Think about it.  You invest in a ten-year Treasury bill at 1.37% or a one-year CD at 0.25% and pay taxes at maybe 15 to 35% (depending upon your tax bracket) and inflation is at 2, 3 or 5%.....so your net return is less than nothing.

Ask yourself, “Why am I making this investment?  What is your objective?  

  1. Grow your assets to provide for a better life in the future for you, your children, grandchildren, and causes you support?
  2. Hang on to what you have with both fists and gradually watch the value depreciate over time?

Are you a “short-timer” or a “long-timer”?  I am not talking about your life expectancy.  I am talking about your perspective.  What is your outlook?  If you care about the future…..not just your future….but THE FUTURE…meaning your future, your kids, grandkid’s, great-grandkid’s future, the future of all mankind and the planet (which to my thinking are all tied together), then act, live, and invest that way.

Eat a reasonable diet, get enough sleep, see your doctor regularly and follow their advice, exercise vigorously and regularly, follow your financial plan to guide your investments, and live your life to the fullest with no regrets.  Articulate your financial goals and priorities.  What rate of return is necessary to accomplish all your goals?   With that information, then decide how to invest your available funds.

Wollman Wealth Designs, Inc. is an investment advisory / financial planning firm with an office in Escondido, CA and we partner with families around San Diego County and the U.S.  Your finances are personal.  Planning for them should be too.  Call or email us with questions regarding your financial plan.


  1. https://news.gallup.com/poll/351932/americans-life-ratings-reach-record-high.aspx
  2. https://www.cnbc.com/2021/07/14/social-security-cost-of-living-increase-for-2022-may-be-largest-in-decades.html
  3. https://www.treasury.gov/resource-center/data-chart-center/interest-rates/pages/textview.aspx?data=yield
  4. https://www.cnbc.com/2021/07/08/us-bonds-treasury-yields-fall-ahead-of-jobless-claims-data.html
  5. https://www.forbes.com/sites/georgecalhoun/2021/07/10/what-is-the-bond-market-telling-us-now-maybe-nothing-at-all/?sh=7842e16b2963
  6. https://www.cnbc.com/2021/07/16/the-mystifying-bond-market-behavior-could-last-all-summer.html

Securities and advisory services are offered through Cetera Advisor Networks LLC (doing insurance business in CA as CFGAN Insurance Agency LLC), member FINRA/SIPC, a broker-dealer and registered investment adviser. Cetera is under separate ownership from any other name entity. CA Insurance License #0604093

The views stated in this letter are not necessarily the opinion of Cetera Advisor Networks LLC and should not be construed directly or indirectly as an offer to buy or sell any securities mentioned herein.  Due to volatility within the markets mentioned, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed.  Past performance does not guarantee future results. Investors cannot invest directly in indexes. The performance of any index is not indicative of the performance of any investment and does not take into account the effects of inflation and the fees and expenses associated with investing.