Millions of Americans on Social Security are anticipating the 2025 Cost-of-Living Adjustment (COLA) to help offset inflation and soaring prices. With a modest increase of 2.5%, this adjustment will impact payments starting late 2024 and early 2025. Here’s everything you need to know, including key dates, benefit amounts, and how this COLA compares to past years.
COLA Increase
The 2.5% COLA increase will raise Social Security benefits to help recipients keep pace with rising living costs. While it’s smaller than previous years’ increases, it’s still above historic trends and remains critical for millions who rely on Social Security as their primary income source.
Benefit Increases
- SSI Recipients: Maximum payment rises to $967 (from $943).
- Married Couples (SSI): New maximum is $1,450 (up from $1,415).
- Essential Persons: Maximum payment increases to $484 (up from $472).
- Retirees: Average monthly payment increases by about $49, reaching $1,920.
Payment Dates
Payment schedules for the 2025 COLA vary depending on the type of benefit and your circumstances.
December 31, 2024
- Who Gets Paid: Supplemental Security Income (SSI) recipients.
- What to Expect: SSI recipients receive their boosted payments early, but the increase may amount to less than the average $49 retirees will see.
January 2025
- January 3: For Social Security recipients who started benefits before May 1997 and those receiving both SSI and Social Security.
- January 8: Recipients with birthdays from the 1st to the 10th.
- January 15: Recipients with birthdays from the 11th to the 20th.
- January 22: Recipients with birthdays from the 21st to the 31st.
COLA
The 2.5% COLA for 2025 is smaller than the 8.7% increase in 2023 and the 3.4% adjustment in 2024. Despite being lower, it exceeds historical averages, particularly during periods like the Great Recession when inflation was minimal.
Smaller Increase
COLA adjustments are tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). In 2025, inflation has eased compared to the pandemic years, leading to a smaller adjustment.
Is It Enough?
Many seniors argue that a 2.5% increase doesn’t fully address rising costs for essentials like healthcare and housing. These costs often rise faster than general inflation, disproportionately affecting retirees.
Who Qualifies
To receive the COLA increase, beneficiaries must meet certain eligibility criteria:
- SSI Recipients: Automatically receive the increase starting December 31, 2024.
- Retirees & SSDI Recipients: Payments begin in January 2025, with dates based on birth months.
- Dual SSI and Social Security Recipients: Payment schedules vary, but some will see increases as early as January 3, 2025.
COLA Adjustments
COLA helps Social Security recipients maintain their purchasing power amid rising costs for food, housing, and other essentials. With Social Security serving as the primary income source for 40% of older Americans, COLA adjustments are a vital lifeline.
While the 2025 COLA may seem modest, it provides critical support to millions who rely on these benefits. If you’re affected, check the payment schedule and plan accordingly to make the most of your increased benefits.
FAQs
When does the 2025 COLA take effect?
The COLA increase begins December 31, 2024, for SSI recipients.
How much will SSI recipients get after COLA?
SSI recipients can receive up to $967 after the COLA adjustment.
What’s the average Social Security benefit increase?
The average increase for retirees is around $49 per month.
Why is the 2025 COLA lower than previous years?
Lower inflation rates led to a smaller COLA adjustment.
Who gets their payment on January 3?
Recipients receiving benefits before May 1997 or SSI and Social Security.
