Social Security checks are a very important part of American society. Many Americans receive this benefit only once a month, which makes them rely on it in most cases. But it is true that sometimes this payment is not enough and lags behind due to inflation.
Price inflation rises sharply every year, causing American retirees who only receive Social Security to have no budget to cover the expenses. This is why the cost of living adjustment (COLA) is so important. Thanks to COLA, all retirees receive a slightly larger check every year than the previous year.
When will we receive the 2025 Social Security COLA?
In 2024, our COLA rose by 3.2%, and the Social Security retirement benefit increased to $4,873. At the same time, the disability benefit provides a benefit of up to $3,822. These are the maximum amounts after the use of COLA, so it does not mean that all Americans will receive such a large check.
However, this year 2024, the new COLA for 2025 will be announced. Regardless of how much we have, the COLA will not take effect until the first payment next year. Therefore, the COLA announcement will happen, but we will have to wait a little longer for the additional funds to be available in the coming months.
The final announcement of the 2025 COLA will not be made until the last days of October. The exact date varies from year to year and we do not have an official date yet, but it is always announced in October. The reason is that the COLA is calculated through the CPI-W for July, August, and September. The US government calculates and announces the COLA after taking into account inflation at that time.
What will be the COLA for Social Security in 2025?
While it is too early to determine the size of the 2025 COLA, we can assume that it will most likely follow the trend of recent years and closely follow the adjustments of the previous year. However, it is unlikely that we will see an increase of almost 9% in 2023, which was a record high due to the abnormal inflation rate. Such significant increases are rare and usually occur only under special economic conditions.
However, it is certain that we will have to wait for a while to see if we will really see another big increase, or if it will be more moderate. The final COLA percentage will be affected by factors such as inflation trends, economic forecasts, and government policy decisions, which are still in flux. Therefore, it is important to stay abreast of developments related to COLAs and Social Security checks. Ultimately, many Americans, especially retirees and those on fixed incomes, rely directly on these checks for financial stability. Annual COLA adjustments play a key role in ensuring the purchasing power of Social Security benefits in the face of rising costs of living.
