The Social Security Administration (SSA) distributes essential payments to millions of retirees and people with disabilities throughout the United States, money that helps them pay all items of their living costs. Many of them rely heavily on these payments, so inflation can be a sword of Damocles hanging over their heads every year. This year, the price increase largely cooled, but in recent years we have had stronger inflation rates, as was the case in 2022 which was 8%.
The SSA observes these increases in products and services to create the cost of living adjustment (COLA), a percentage that, precisely, impacts the paychecks of beneficiaries so that they do not lose purchasing power. At the end of 2022, the agency ordered a COLA increase of 8.7%, which began to be applied later. Thus, every year on those dates, the benefits are reviewed. In 2024, that rate was 3.2%, and so on.
Five questions about the Social Security COLA meticulously answered
We followed up on the online forums most used by Social Security beneficiaries to find the most frequently asked questions, and we have put those questions below with the answers in the most synthetic way possible.
When will an official 2025 COLA be announced?
The first question we all have every year is when the COLA is officially announced each year. This occurs in mid-October of each year. This announcement is made by the Social Security Administration (SSA) after the third quarter Consumer Price Index for Urban and Clerical Workers (CPI-W) report is released.
When will my next COLA take effect?
The COLA adjustment takes effect as of January 1 of the following year. This means that any increase in benefits due to the 2025 COLA will be reflected in checks sent starting in January of that year. That said, between the October announcement and the end of December, profits will not be impacted by this increase.
How much will my monthly Social Security check increase after the 2025 COLA takes effect?
The increase will depend on the exact COLA percentage and other factors, such as your Medicare enrollment. For example, if the COLA is 2.5% and you currently receive $2,000, your monthly benefit would increase by $50. If you are not enrolled in Medicare, that increase would remain the same. However, if you pay your Medicare Part B premiums through your benefits, an increase in your premium (for example, $10 more) could reduce your net increase to $40.
Where can I track COLA percentages from recent years and this year?
You can check historical and current COLA percentages on the official website of the Social Security Administration (SSA), in the section dedicated to COLA: www.ssa.gov. There, the SSA publishes annual adjustments and a record of COLA percentages for recent years.
Keep in mind that this is the official source of this number, and any other publications, not only prior to the official announcement but also afterward, are unofficial if they do not come from the definitive SSA number.
Does the COLA increase affect other benefits outside of Social Security, such as SNAP Benefits, for example?
Yes, the COLA increase can affect other benefits such as SNAP (Supplemental Nutrition Assistance Program). An increase in Social Security benefits could increase your total income, which could affect your eligibility or the amount of assistance you receive under other income-based benefit programs. However, each program has different thresholds and income criteria, so it’s important to check how COLA changes impact your specific situation.