If October comes around, the Social Security Administration is always getting ready to announce the new Cost of living adjustment (COLA) for 2025. Millions of Americans get payments from Social Security that are changed by the cost of living adjustment. A date has been set for the public announcement of the cost of living adjustment, and people are looking forward to it.
The Social Security increase is important to a lot of people in the United States, especially those who count on it to meet their basic needs. In a world where inflation is always changing, the cost-of-living adjustment affects the income of retirees, disabled people, and other recipients every year.
The new retiree paycheck increase will soon be officially announced
In this case, everyone is looking forward to hearing about the 2025 COLA. The date that the new change is announced is very important because it will have a big effect on the budgets of millions of Americans who depend on Social Security to pay their bills. The COLA is a yearly adjustment system that is meant to make up for the loss of Social Security benefits caused by rising prices.
This change is based on the Consumer Price Index (CPI), which shows how the prices of goods and services in the US have changed over time. As inflation rises, the cost of living adjustment is sometimes changed to keep beneficiaries from losing buying power. Recently, adjustment rates have been all over the place, but in 2023, they are going to go up a lot because of global conflicts and inflation caused by the pandemic.
This is one of the biggest increases in recent memory, which shows how important the 2025 news was. Many people expect it to be kept the same or even raised to fight inflation. In October of every year, the US Social Security Administration releases the most recent cost-of-living increase (COLA).
The CPI statistics used for this announcement is from the third quarter of the year, so the 2025 COLA will be announced in the middle of October 2024.
The beneficiaries will start to see changes to their payments in January 2025, when the COLA raise starts to take effect. The cost of living adjustment for this situation is likely to reflect current inflationary trends, which aren’t as bad as the highest points seen in previous years but are still making things very hard financially for many families across the country.
How much will be the expected impact on Social Security beneficiaries?
In December 2024, retired workers will get an average of $1,860 a month in Social Security payouts. This is a big increase from December 2010, when they only got $1,176 a month. The Committee to Protect Social Security, on the other hand, thinks that seniors would need 20% more funds to handle today’s inflation-driven economic problems.
This year, Social Security and Supplemental Security Income (SSI) payments went up by 3.2% for more than 71 million Americans. In contrast, the average beneficiary would receive an extra $59 per month if the same increase were implemented by 2025, bringing the average monthly benefit to nearly $1,919.
So, we won’t know if the cost of living adjustment increase will be enough to fix the current economic problems until the third quarter of 2024. However, many economists think that the final cost of living adjustment (COLA) number for 2025 will represent the reality of inflation. The COLA raise has a big effect on people who get Social Security.
Millions of retirees can only continue to live comfortably even though costs are going up because of the annual rise. Without it, a lot of people, especially those with set or limited incomes, would not be able to buy as much. Finally, if the 2.5% COLA increase were to go into force, the following amounts will be expected to be paid to retirees:
| Retirement benefits | Social Security checks | 2.5% COLA increase | Extra income |
| On average | $1,900 | $1,948 | $48 |
| Age 62 | $2,710 | $2,778 | $68 |
| Age 67 | $3,822 | $3,918 | $96 |
| Age 70 | $4,873 | $4,995 | $122 |