There are millions of people in the United States who are on Social Security. They are all looking forward to the Cost-of-Living Adjustment (COLA) news on October 10, 2024. As it happens every year, this change is meant to counteract the effects of inflation and keep the buying power of benefits for seniors and people with disabilities.
Once the percentage raise is announced, the change will happen gradually over the course of 2025. However, some beneficiaries may start to see the new amount on their checks by the end of 2024. Millions of Americans depend on Social Security as their main source of income, so this raise is very important.
The annual Social Security adjustment and its impact on benefits
The U.S. government makes the COLA every year to make sure that inflation doesn’t eat away at Social Security payments. It’s based on how much goods and services have cost going up, and making sure that it’s used makes sure that payments to recipients are still enough to meet their basic needs.
Supplemental Security Income (SSI) is one of the first programs to change to recognize this change. As of December 31, 2024, SSI recipients will start getting checks with the new amount. This is because January 1, 2024, is a holiday and checks are sent out early.
Current amounts and estimated increase
At the moment, people who get Social Security payments get between $698 and $943 a month, based on their resources and financial situation. Couples that meet the requirements can get up to $1,415 a month, and people who are considered important persons (EP) can get an extra $472 a month.
The Senior Citizens League thinks that the COLA for 2025 will be about 2.5%. The following rises are likely to happen for those who benefit if this percentage is confirmed in October:
- Those currently receiving $472 will see an increase to $484 in 2025, a boost of $12.
- Individuals who receive $698 per month will start receiving $715, an increase of $17.
- Beneficiaries currently receiving $943 will see their checks increase to $967, representing a $24 rise.
- Couples receiving the maximum of $1,415 per month will see an increase of $35, bringing the total to $1,450 per month.
Even though these raises might not seem like much, they can make a big difference for many families who depend on these funds to live.
How the adjustment impacts different beneficiary groups
The Cost-of-Living Adjustment doesn’t just affect people who are retired. This boost is also good for disabled people who depend on Social Security. This group often has to pay more for medical care, so these benefits are important for them to keep their value as the cost of healthcare and other necessary services goes up.
For many recipients, especially those getting smaller amounts, each increase helps some with the rising costs of things like food and rent. The COLA may not seem like much, but it helps families deal with the effects of inflation on their budgets.