How much more in Social Security benefits will you receive in 2025? If you already get monthly Social Security checks or you’re looking to sign up to do so, it’s likely you’re eagerly awaiting the COLA increase announcement. Analysts have offered their predictions on how much extra money you could be getting with your benefits for the next year, and there are ways to calculate how much you may get per check already. But the COLA adjustment could mean significant changes to how much money you have to play around with each month.
Each year, the Social Security Administration adjusts how much it pays in benefits to account for inflation through an annual cost-of-living increase. The Social Security Administration announces the official COLA adjustment in October, but as we get closer to the fall experts can look at monthly inflation trends and get a good idea for how much Social Security retirement benefits will change.
The latest estimate gives us a closer glimpse as to what could indeed be the official rate when announced in a few months. We’ll give you the details. For more, check out the Social Security payment schedule and here’s how to apply for Social Security benefits.
What is COLA?
To keep up with the effects of inflation, Social Security recipients usually receive an annual cost-of-living adjustment, aka COLA, with their January check. The adjustment is based on the average change over time in the prices paid for consumer goods and services and is determined by the Bureau of Labor Statistics in the Department of Labor. The COLA is set in the third quarter of each year.
Which government benefits make benefit adjustments using COLA?
Social Security isn’t the only government benefit that is affected by the COLA. Social Security Disability Insurance, Supplemental Security Income, Medicare, Supplemental Nutrition Assistance Program (including food stamps and other programs) all make use of COLA to account for inflation when setting benefits.
What could COLA increase be in 2025?
COLA for 2024 is 3.2%. Looking ahead, the Senior Citizens League — a nonpartisan advocacy group for senior citizens — after looking at this year’s monthly inflation trends forecast COLA will be 2.63% for 2025
The adjustment is closely watched by seniors because the annual COLA change is designed to help them keep up with rising costs. And while the annual COLA increase has been as high as 8.7% in recent years, some say it’s not enough to cover inflation. According to a Senior Citizens League survey, 69 percent of respondents said their household costs rose faster than the COLA last year, with costs for food and housing leading the way.
COLA Increases Year Over Year
| Year | Increase over previous year |
|---|---|
| 2024 | 3.2% |
| 2023 | 8.7% |
| 2022 | 5.9% |
| 2021 | 1.3% |
| 2020 | 1.6% |
Note: The Social Security Administration normally announces the adjustment the second week of October. The new rate goes into effect the following January.
Keep in mind that these are estimates that can change every month based on the previous month’s inflation rate, and though they tend to be somewhat in line with the official rate, they’re not always spot on.
For more, check out how to apply for Supplemental Security Income and our Social Security and SSDI cheat sheet.
