Automatic cost-of-living adjustments, or COLAs, were put in place in 1975 because Social Security recipients needed a sure way to keep their purchasing power over time. Before 1975, only certain laws made it possible to raise Social Security benefits.
Each time a COLA is added, it has been linked to inflation. Some of you may have noticed that inflation has slowed down this year. Because of this, the new cost of living adjustment will only go up by 2.5%.
Compared to this year’s 3.2% COLA, that is a bit of a letdown. However, a 2.5% COLA is about the same as the average Social Security COLA over the last ten years. But in 2025, some people who get Social Security may not be able to keep the full amount of their COLA. Because of these things, yours may be lowered.
Why will Social Security benefits be reduced in 2025?
Medicare costs will likely increase
If you are signed up for Medicare but have not started getting Social Security benefits yet, it is your job to make sure that your monthly Part B premiums are paid. If you get both Social Security and Medicare, this is a little easier because your monthly Part B costs are taken out of your Social Security benefits.
But the problem is that Medicare Part B is going to cost more in 2025. From now on, the normal monthly Part B premium, which is about $174 right now, will be $185. Because your Social Security COLA went up by about $10, it will go down next year, giving you a slightly smaller raise.
Increases in Medicare will never do more than eliminate your COLA
You might be upset that your Social Security COLA goes down in 2025 because Medicare costs are going up. One thing you should be thankful for, though: your Social Security income will never go down because Medicare Part B costs go up every year.
Because of what is called the “hold harmless provision,” any Part B increase can only make your Social Security COLA go down to zero.
No matter what happens with Medicare, you will always get at least the same amount of Social Security at the start of a new year as you did in December of the previous year, unless there is a specific reason for a smaller check, like having your benefits garnished because of an overdue tax bill or getting a smaller check for exceeding Social Security’s earnings-test limit.
Of course, most people who get Social Security will not have to worry about their 2025 COLA being taken away. If you do not count Medicare, the average beneficiary’s monthly benefit is going up by about $50, but their normal Part B payment is only going up by about $10.
The average Social Security recipient who is also on Medicare still gets an extra $10, so they still see an increase of almost $40. The good news is that if inflation keeps going down, you might be able to use any increase in your Social Security income more efficiently.
How much will the Social Security benefits increase in the coming month?
Based on the most recent confirmed cost of living adjustment (COLA), people who get retirement, survivor, and disability insurance (RSDI) from Social Security will see their benefits go up by 2.5% starting in January 2025. Because of this percentage increase, the following payment amounts will be sent to beneficiaries:
| Retirement benefits | Social Security benefits | 2.57% COLA increase | 2.63% COLA increase |
| On average | $1,900 | $1,949 | $1,950 |
| Age 62 | $2,710 | $2,780 | $2,781 |
| Age 67 | $3,822 | $3,920 | $3,923 |
| Age 70 | $4,873 | $4,998 | $5,001 |
| Survivor benefits | Social Security benefits | 2.57% COLA increase | 2.63% COLA increase |
| On average | $1,505 | $1,544 | $1,545 |
| Individual | $1,773 | $1,819 | $1,820 |
| 2 Children | $3,653 | $3,747 | $3,749 |
| Disability benefits | Social Security benefits | 2.57% COLA increase | 2.63% COLA increase |
| On average | $1,537 | $1,577 | $1,577 |
| Blind recipients | $2,590 | $2,657 | $2,658 |
| Maximum payment | $3,822 | $3,920 | $3,923 |
Also See :- Double SSI payments in May, August and October 2025 – Confirmed on Social Security’s schedule