The projection of the Social Security cost of living adjustment (COLA) for the year 2025 will be close to 2.5%, according to the new inflation data, these estimates do not reach the inflation rate that exists today, which There is some concern that the COLA does not fully reveal retirees’ true living expenses, particularly in areas such as food, housing, and medical expenses.
The final COLA for the year 2025 will be determined in just a few days, in the month of October, and the projections that have been made recently have marked a significant gap between inflation and the proposed adjustment, there have been some discussions about the latest projections for the 2025 Social Security Cost of Living Adjustment (COLA), and how cooling inflation could affect it.
Estimates for COLA 2025 — Social Security Benefits to Increase
With the publication of new data regarding inflation in the United States, a revision of the estimates for next year’s COLA was made and it is important to understand what this means for beneficiaries. Doing a data check of what the COLA will look like for next year, we already know, COLA is a very significant number for all retired citizens, and as has been talked about in the past, this is a moving target, since that all of these are just estimates.
We felt the need to state this from the beginning, but it’s actually critical to see where these estimates are, because they come from professionals in this space who make a living from this, and it has a huge impact on the quality of life of retirees. According to inflation data that was published a few months ago by the federal government in May, the Social Security COLA for the year 2025 could be around 2.5%, so the League of Senior Citizens projects that 2.5 % TAIL.
Forecasts of Expert Analysts
Other outside analysts, such as Mary Johnson, have made forecasts for a slightly higher COLA, around 3%. But if we look at the information that recently came out from the BLS about the Consumer Price Index, which had an increase of 3.3% in the last year. Indeed, both estimates, even with Mary Johnson’s higher estimate of a 3% COLA, are still below inflation. And since analysis has been done in the past, the 2024 COLA, a large part of retirees have the feeling that this was not enough to equalize the salary.
There’s the Senior Consumer Price Index that relates more to food and healthcare, which is known to make up a larger percentage of retirees’ consumption patterns. Therefore, simply using the broad-based CPI figure is often not a reflection of the reality of what retirees pay, which is why we can see these gaps and people can feel that they are not falls short because their actual spending is higher than the figure COLA is trying to adjust.
Current Social Security Payments
Payments vary based on several factors, including years worked, total Social Security taxes paid, and retirement age:
- Retired workers: about $1,907 monthly.
- Retired couples (filing a joint return): About $3,303 monthly.
- Survivor benefits: About $1,509.50 monthly.
- Spouses of retired workers: About $910 monthly.
- Children of retired workers: About $892.39 monthly.
- SSI beneficiaries (individuals): About $943 monthly.
SSI beneficiaries (couples): About $1,415 monthly.