One of the best times for retirees in the United States is the announcement of the annual COLA. Every year, the Social Security Administration increases the amount of retirement and Supplemental Security Income checks. And this increase is made through the so-called Cost of Living Adjustment.
This annual increase depends on several factors. Retirees as individuals cannot control these elements, but they can know in advance an approximation of the COLA increase. By knowing the key dates we can get an idea of what the increase in Social Security checks will be for next year.
There are three key points in the year to keep track of COLA information. On the one hand, we must control the months that are taken into account for the increase in checks. On the other hand, we must know when the increase is announced. Finally, when is the first check sent with the increase already included.
If we take these three dates into account, it will be much easier to know an approximate amount before the official announcement. Let’s take a closer look at these dates.
Important dates for COLA 2024
First of all, remember that these dates are important but we don’t have any official data on them yet. That is, we are now looking at a series of assumptions that can be useful for us to more or less know the 2024 COLA increase.
These are the items we need to monitor:
CPI-W increase in a few months
The increase in Social Security checks via the COLA is made from the increase in the CPI-W. To calculate the entire final check, the government takes into account inflation and the CPI-W increase for the months of July, August and September.
So we should monitor the general price increases in those months to get an idea. Still, any amount we think will be merely indicative.
Official announcement of COLA 2024
The announcement of the 2024 COLA will be official in October 2023. So it won’t be until the middle of that month that we will know the exact amount. Last year, the increase was 8.7%, but this year it may go down to 3%.
Everything will depend on the above-mentioned elements. Therefore, we must wait a bit to know the exact number.
As every year the announcement is made on approximately the same date, it is easy to know the day. In this case we find that the announcement will come in mid-October. Looking at the calendar we can see that the 16th is a Monday, so that is probably when the announcement of the Social Security COLA will be made.
First check with the new COLA
The first of the 2024 checks with the COLA applied will be the January Supplemental Security Income. This means that the first check with the 2024 increase will actually arrive in 2023.
This is due to a timing irregularity. Since the payment for each new check is due on the 1st of each month and January is a holiday, the payment is sent out earlier. So the first payment with the COLA already applied actually arrives in this year.
Still, for all practical purposes it is still a 2024 calendar payment. So for the IRS, the Social Security Administration and the government the check pertains to next year.