The Federal Government, through the Social Security Administration, will announce the 2025 COLA figure on October 10. However, this day may bring disappointment among the 71 million recipients in the United States.
The 2025 COLA increase by Social Security may be a letdown because high prices are still affecting retirees, SSDI (disability), and SSI recipients across the country. So, a low cost of living adjustment may not be what beneficiaries need.
Latest 2025 COLA projection for Social Security
One of the best projections for the 2025 COLA has come from the Senior Citizens League claims that benefits could go up by just 2.5%. The SCL has always made accurate forecasts, so it is expected a very similar increase in payments.
Since the 2024 COLA was 3.2%, the 2023 COLA was a staggering 8.7%, and a 5.9% in 2022 next year’s boost seems to be really small. However, looking back in time, there seem to be even lower COLAs.
Therefore, a 2,5% COLA increase is not that bad after all. What is more, it may have some advantages for those Social Security recipients who are about to move to a different tax bracket when their benefits go up. So, it could reduce the amount of money they receive.
Possible Social Security amounts after the 2025 COLA increase
If there were a 2.5% increase, there could be some higher earners who receive $4,000 in 2024 who could get $100 extra from January 2025 onward. However, average payments are not so high.
Hence, a moderate boost is expected in most cases. For example, you could receive $48 extra if you get an average payment worth $1,968. For those who think that $48 would not make any difference, there is some advice.
Save that money and create an emergency fund. In this way, you will have 576 dollars in 12 months. Those who just receive $1,000 from Social Security can only get 25 dollars extra. So it will depend on your payment whether you get more or less money from SSA.