Retirees collecting a Social Security benefit in the United States are celebrating. In just a couple of months the monthly check will become larger for all of them without exception.
So, if you’re currently collecting a Social Security benefit, whether it’s for disability or some other reason, the payment will go to a higher amount. And this is thanks to the Cost of Living Adjustment (COLA), which the government applies every year.
The COLA is a mechanism invented by Social Security and the United States government to help benefit recipients cope with inflation. Thanks to the COLA, retirees do not lose purchasing power.
At the beginning of each year, the monthly checks increase by an amount that depends on a variety of factors. And in the coming year we will see, as usual, this increase within the retirement checks.
HOW MUCH WILL SOCIAL SECURITY CHECKS INCREASE?
The exact amount could be around $55 on average. This amount is calculated from 3% on an average Social Security benefit of $1,888 per month.
As for next year’s COLA, it’s true that we don’t have an official figure, but it will be coming very soon. Still, experts predict the increase will be around that figure, so it is very likely we will see something similar.
This increase will not be as large as the 2024 increase, which had a COLA of 8.7%, but it is still enough to be able to cope with inflation, at least in part. Remember that the COLA is set so as not to lose purchasing power.
To calculate the COLA, the Social Security Administration takes into account the CPI-W for the months of July, August and September. By comparing this inflation with the previous year’s inflation, it calculates the overall inflation and then calculates a figure for the COLA.