Social Security Announces 2.5% Increase in Benefits for 2025
Author: Social Security Administration
Published: 10 Oct 2024
Publication Details: Peer-Reviewed, Announcement
Contents: Synopsis - Introduction - Main - Related Publications
Synopsis: This press release from the Social Security Administration announcing a 2.5% cost-of-living adjustment (COLA) for 2025 is significant and informative. It provides crucial details about the increase in Social Security and Supplemental Security Income (SSI) benefits that will affect over 72.5 million Americans. This adjustment, which translates to an average increase of about $50 per month for retirement benefits, is designed to help beneficiaries keep pace with inflation and maintain their purchasing power. The release also includes important information about changes to the taxable maximum for Social Security taxes and updates to the SSA's notification process.*
Introduction
Social Security benefits and Supplemental Security Income (SSI) payments for more than 72.5 million Americans will increase 2.5 percent in 2025, the Social Security Administration announced. On average, Social Security retirement benefits will increase by about $50 per month starting in January.
Main Content
Over the last decade the COLA increase has averaged about 2.6 percent. The COLA was 3.2 percent in 2024.
Nearly 68 million Social Security beneficiaries will see a 2.5 percent cost-of-living adjustment (COLA) beginning in January 2025. Increased payments to nearly 7.5 million people receiving SSI will begin on December 31, 2024. (Note: Some people receive both Social Security benefits and SSI).
"Social Security benefits and SSI payments will increase in 2025, helping tens of millions of people keep up with expenses even as inflation has started to cool," said Martin O'Malley, Commissioner of Social Security.
Some other adjustments that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) is slated to increase to $176,100 from $168,600.
Social Security begins notifying people about their new benefit amount by mail starting in early December.
This year, for the first time, Social Security beneficiaries will receive a newly designed and improved COLA notice that makes it easier for customers to find the information they need most. The simplified COLA notice is now only one page, uses plain and personalized language, and provides exact dates and dollar amounts of a person's new benefit amount and any deductions.
Individuals who have a personal my Social Security account can view their COLA notice online, which is secure, easy, and faster than receiving a letter in the mail. People can set up text or email alerts when there is a new message - such as their COLA notice - waiting for them in my Social Security.
People will need to have a personal my Social Security account by Nov. 20 to see their COLA notice online.
Information about Medicare changes for 2025 will be available. For Social Security beneficiaries enrolled in Medicare, the 2025 benefit amount will be available via my Social Security's Message Center starting in late November. Those who have not opted to receive messages online will receive their COLA notice by mail in December.
The Social Security Act provides for how the COLA is calculated. The Social Security Act ties the annual COLA to the increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) as determined by the Department of Labor's Bureau of Labor Statistics.
Attribution/Source(s): This peer reviewed publication was selected for publishing by the editors of Disabled World (DW) due to its relevance to the disability community. Originally authored by Social Security Administration and published on 10 Oct 2024, this content may have been edited for style, clarity, or brevity.
* Editorial additions by Ian C. Langtree.