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Thursday, October 13th 2022

Cost of Living Adjustment Will Increase Meaning More Money for Expats in 2023

Written by

Rafael Bracho

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Introduction:

Cost of Living Adjustment Will Increase Meaning More Money for Expats in 2023

It’s no secret that things have been tough for an aging baby boomer population on Social Security. It’s no different for those expats living in Mexico. Thankfully there’s good news on the horizon in 2023.

Furthermore, there will likely be changes made to the Mexican peso, all of which indicate that now is the perfect time to be an expat living in Mexico. They will likely be getting more money—and that money will go farther.

Social Security Is Getting Increased in 2023

Cost of Living Adjustment Will Increase Meaning More Money for Expats in 2023

Released on Thursday, October 13th, 2022—the Social Security Administration has approved an 8.7% bump in Social Security payouts, the largest social security increase in four decades. In light of the economic downturn and the rise in inflation, Americans will be getting more money from their Social Security.

Americans will be getting an 8.7% increase in their Social Security starting in January, 2023. That’s right, for 70 million Americans who depend on Social Security, their budgets will get a bit of relief in the face of inflation.

And things aren’t getting any better in Mexico. It’s needed as the cost of living has drastically increased in Mexico–especially in the more affluent, gentrified areas where expats live. But there’s more hope for those Social Security recipients living in Mexico.

The Mexican Peso Is Expected to Devalue Against the Dollar

Cost of Living Adjustment Will Increase Meaning More Money for Expats in 2023

For those expats on social security living in Mexico, there’s more hope on the horizon than the 8.7% increase predicted to hit at the start of January. Also, the Mexican peso is predicted to devalue further against the dollar in 2023.

That means that your US dollar will become more Mexican pesos soon.

That’s right! Macario Schettino—Mexican economist and political analyst—has predicted that the Mexican peso could likely be devaluing against the US Dollar. Some predictions include even 24:1 or 25:1, instead of the roughly 20:1 that we see today.

So, not only will expats receiving Social Security benefits be getting more money, it will be going farther in this Mexican economy. This should help alleviate some of the stress associated with the cost of living increases in Mexico today.

What This Means for Expats

Cost of Living Adjustment Will Increase Meaning More Money for Expats in 2023

For those expats living in Mexico who will be getting an 8.7% increase in their Social Security benefits, they can expect their standard of living to increase drastically, taking advantage of the largest Social Security increase in the last 40 years.

Furthermore, the Mexican peso will likely be devaluing more than at any point since the drastic fall this currency took in 2013-14. Seeing as how the bulk of social security retirees are between the ages of 62 and 70—they will still be eligible for expat insurance.

If premiums should increase in the next year or two to adjust for this cost of living increase, that would mean now is the perfect time to purchase expat insurance while more money is secured on the horizon.

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