The cost-of-living adjustment (2025 COLA) will boost monthly payments for retirees in the United States. So, if you are at least 62 years old and you receive a check or direct deposit from the Social Security Administration (SSA), you will benefit from a jump of 2.5%. This is the way the Agency tries to make up for the loss of buying power due to inflation and the continuous rise in prices.
Bear in mind that the 2.5% COLA increase will be for all retirees who get Social Security benefits. So, you will benefit from it regardless of the payment amount you receive from SSA.
How much will the COLA increase be?
The COLA boost will mean that if you receive 100 dollars from Social Security, you get 2.5 dollars extra per month. So, if your monthly payment is now 100 dollars, it will become 102.5 dollars in 2025.
That will mean you will receive 25 dollars extra if your monthly payment in retirement is worth $1,000. Therefore, to get $50 extra per month in 2025 from the COLA increase, you must receive $2,000 from SSA.
In this case, if your monthly payment is $2,000 in 2024, you will get 600 dollars extra in 1 year. Since you get 12 payments in one year, and you get $50 extra per month, 12 times 50 is 600.
When will I know the exact amount of the COLA increase?
The Social Security Administration will soon issue a notice to inform retirees about the cost-of-living adjustment. By doing so, all retirees will be informed of the exact payment amount they will receive from January 3 onward.
If you do not receive an SSA notice in December 2024, you can simply visit your my Social Security account. Of course, you will need to sign in to have access to this information. So register if you have never done so.
For your information, the January payments will bring the COLA. The payment dates the Social Security Administration has scheduled are:
- January 3
- January 8
- January 15
- January 22
