For the last 85 years, Social Security has been an important financial support for older Americans who can no longer take care of themselves. A study by the Center on Budget and Policy Priorities shows that this important program helps about 22.7 million people escape poverty every year, including around 16.5 million adults who are 65 years old and older.
Social Security has been an important support for more than 80 years, and it keeps changing. Every year, this famous program gets new updates. As we enter the new year, there are six important changes to Social Security that are now active.
Impact on Monthly Social Security Benefits
One of the most awaited announcements each year is the Cost-of-Living Adjustment, or COLA. This adjustment is how the Social Security Administration (SSA) changes benefits to keep up with inflation.
For example, if the prices of common items and services that retirees buy go up by 2%, 3%, or 5%, Social Security benefits should also increase by about the same amount to help retirees keep their buying power.
In 2025, recipients of Social Security checks will see a 2.5% cost-of-living adjustment (COLA). This is the smallest cost-of-living adjustment in four years, but it is still important because it is the fourth year in a row that increases have been higher than the average 2.3% seen in the last 15 years.
SSDI and Other Benefits to Change
Most retired workers will see their monthly check go up by $49, making it $1,976 next year. Workers with disabilities and survivor beneficiaries will get an average increase of $38 in their benefit checks in 2025, bringing their totals to $1,580 and $1,551, respectively.
Even though there is good news about a higher cost-of-living adjustment (COLA), the situation is actually more complicated. Rising costs for housing and medical care, along with increasing Medicare Part B premiums, are reducing the value of each dollar from Social Security.
These factors continue to create challenges for people trying to get the most from their Social Security benefits.
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