The 2025 COLA hike will raise benefits by around 2.5%. However, for some, the cost-of-living adjustment boost will not go into effect until December 31, 2024, while others would have to wait until January 2025.
If you qualify for your January 1 payment, which is planned for December 31, 2024, it is because you get Supplemental Security Income. The good news is that you’ll get the COLA boost before retirees and SSDI recipients. Unfortunately, there is some negative news for SSI recipients.
SSI, Social Security recipients get COLA on different dates
If you get Supplemental Security Income, your increase will be 2.5% on December 31. However, because the maximum SSI amounts and average payments are smaller, you will not receive the additional $50 that retirees receive on average.
This will be the lone drawback, but qualifying recipients can receive up to $967 after COLA. This is the new maximum amount for SSI, up from $943. Eligible married couples will receive up to $1,450, up from $1,415.
An essential individual can receive up to $484, up from $472. Retirees and SSDI recipients will get the 2025 cost-of-living adjustment rise on the following dates:
- Cost-of-living adjustment on January 3
- Cost-of-living adjustment on January 8
- Cost-of-living adjustment on January 15
- Cost-of-living adjustment on January 22
How does the 2025 COLA increase compare to previous years?
The 2025 cost-of-living adjustment (COLA) for Social Security benefits will be 2.5%, which is lower compared to the increases in recent years. In 2023, the COLA was 8.7%, and in 2024 it was 3.4%.
- The 2.5% COLA for 2025 will result in an average monthly benefit increase of around $48, raising the average payment to nearly $1,920.
- The 2025 COLA is lower than recent years’ increases. But, it is higher than historic trends, especially during the Great Recession when inflation was low.
- COLAs help Social Security recipients keep up with rising prices for essentials like food and housing. They have been automatic since 1972.
- Some seniors and experts argue that the 2.5% COLA is too low. It doesn’t reflect the inflation retirees face, especially in healthcare and housing costs.
- Social Security is the main income for 40% of older Americans. So, COLAs are vital for an inflation-proof retirement income.
Eligibility for Social Security COLA in January 2025
If you started receiving Social Security before May 1997, you will receive a cost-of-living adjustment rise on January 3, 2025. Or if you are getting both SSI and Social Security benefits.
If you do not qualify for the payment on the 3rd and meet the birthday criterion (born between 1 and 10), COLA will be added to your January 8th payment. Of course, all of these January payments require that you have filed for retirement or SSDI.
Americans on Social Security born between 11 and 20 will receive the COLA rise on January 15. If your birthday falls between the 21st and 31st, it will be January 22. On average, Social Security will provide an extra $49 to retirees.
Source:
- https://www.ssa.gov/news/press/factsheets/colafacts2025.pdf
- https://www.ssa.gov/pubs/EN-05-10031-2025.pdf