Through the Cost of Living Adjustment (COLA), Social Security payments have gone up. This gives people in the United States a little extra money every month. This extra money is not for people to show off their wealth; it is meant to keep up with yearly inflation.
On the other hand, Social Security payments do not always go up by the same amount as the Cost of Living Adjustment (COLA). Because each year has its own inflation, it also has its own COLA. We might see a rise or fall in check payments depending on how much prices go up.
How much will the Cost of Living Adjustment (COLA) increase in 2025?
People in the United States who get Social Security may see this new COLA raise starting in January 2025. This means that anyone who has been approved for retirement will be able to get these extra funds without any issues.
The Cost of Living Adjustment (COLA) is expected to be around 2.5%. We do not have official numbers yet for the number of the increase, but it seems likely.
This would mean an increase that is even smaller than the one we saw this year (2024), but prices have not gone up much in recent months because inflation has stayed the same.
If it turns out to be the 2.5% raise, we would get an extra $2.5 a month for every $100 we earn.
That way we could get some extra cash. It is true that the extra money would not be very much, but when we add in the check that retirees get every year, it could be a big number.
When will we know the Cost of Living Adjustment (COLA) 2025 figure?
October is the most important month to know about the Cost of Living Adjustment (COLA). We will know around the second week of October what percentage the US government will add to Social Security checks.
We will have to wait until then to find out how much our retirement check will go up.
- 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 inflation rates for July, August, and September are important to know about the CSS. Because of this, the CPI-W rise in these months is very important for figuring out what the Cost of Living Adjustment will be in the future.
Also, keep in mind that the process is automatic. This means that we will not have to ask for the Cost of Living Adjustment (COLA) raise in our Social Security retirement checks ever again. It will be done immediately by the Administration, and it will be sent with our first payment of 2025.
