The increase in Social Security benefits through the Cost of Living Adjustment (COLA) makes it possible for United States citizens to have a little extra money each month. This extra money is not for citizens to flaunt at a higher level of wealth, but to balance annual inflation.
However, not every year we can see an equal Cost of Living Adjustment (COLA) increase in Social Security benefits. Each year has its own inflation and therefore has its own COLA. Depending on how much prices increase we may find that check payments increase more or less.
How much will the Cost of Living Adjustment (COLA) increase in 2025?
Starting next January 2025 we may see this new COLA increase for United States citizens collecting a Social Security check. Therefore, anyone with an accepted retirement will be able to get these extra dollars without any problems.
As for the number of the increase we cannot yet speak of official figures, but it is very likely the Cost of Living Adjustment (COLA) will be around 2.5%. This would imply an even smaller increase than this year 2024, but the truth is that inflation is stagnant and has not significantly increased prices in recent months.
In the event that it is finally the 2.5% increase this would imply that for every $100 we would have $2.5 more each month of the benefit collection. So we would get a little extra money. Although it is true that it would not be too much extra money, it is true that if we take into account the check for retirees for the whole year, it could be a very important figure.
When will we know the Cost of Living Adjustment (COLA) 2025 figure?
The key month to know all the information about the Cost of Living Adjustment (COLA) is October. Around the second week of October we will have the percentage that the United States Government will increase in Social Security checks. So we will have to wait until then to find out what the increase in our retirement check will be.
- Effective date of increase: The COLA adjustment will begin in January 2025.
- Estimated percentage increase: The COLA is expected to be around 2.5%, which is lower than the 2024 increase.
- Monthly impact: For every $100 received, the increase would be $2.5 per month.
- Annual importance: While the monthly increase is small, over the year it can represent a significant amount for beneficiaries.
- Key month for official announcement: The official COLA figure will be announced in October, around the second week.
- Determining factors: The COLA increase will depend on inflation for the months of July, August, and September (measured by the CPI-W).
- Automatic process: There is no need to apply for the adjustment; it will be applied automatically in the first payment of 2025.
Also, the important data to know the COLA is the inflation for the months of July, August and September. Therefore, the CPI-W increase in these months is key to determining what the Cost of Living Adjustment will be in the future.
In addition, it is important to remember that the process is automatic, which means that we will not have to request the Cost of Living Adjustment (COLA) increase in the Social Security retirement checks at any time. The Administration itself will do the calculation automatically and send it in our first payment of 2025.
