How the 2025 Social Security COLA Adjustment Affects Your Payments

By John

Published on:

The Cost of Living Adjustment (COLA) is an annual change made by Social Security to help people keep up with inflation.

This increase ensures that people receiving benefits don’t lose purchasing power as prices go up.

However, not everyone gets the same COLA increase at the same time, and the amount can vary based on your situation. Here’s a breakdown of who gets it and when it happens.

What is COLA?

The COLA, or Cost of Living Adjustment, is a way to increase payments to people on Social Security to help them keep up with inflation.

Without it, people on Social Security might find that their money buys less because prices for things like food, gas, and healthcare increase. The COLA amount is calculated based on how much inflation has occurred during the year.

Who Gets the COLA Increase?

For most people, the COLA increase will apply to Social Security payments made in January 2025. This increase will add an extra 2.5% to monthly payments, meaning if you usually receive $1,000, you’ll get an extra $25 every month. The exact amount depends on your original payment.

However, some people, like those receiving Supplemental Security Income (SSI), will see the increase even sooner. If you’re on SSI, the COLA will start showing up in your payment on December 31, 2024. But you won’t actually get the increase until January 2025, so you’ll have to wait a little longer.

Eligibility for SSI COLA Increase

To get the extra money with SSI, you must meet certain eligibility rules. Generally, you must:

  • Have a low income
  • Have limited resources
  • Meet at least one of the following conditions:
    • Be 65 years old or older
    • Have a disability
    • Be blind

You must also be living in the United States and meet other residency rules to qualify. If you meet these conditions, you will see an increase in your monthly SSI payment starting on December 31, 2024.

Social Security Dates for 2025

For those on Social Security or Disability Insurance, the first payments with the new COLA adjustment will be sent out on January 3, 8, 15, and 22, 2025. The exact date you receive your payment depends on when your birthday falls within the month.

The 2.5% COLA means you’ll get more money every month. For example, if your payment was $1,000, you’ll now receive $1,025. This will continue each month, helping you keep up with rising costs.

How Much Will COLA Affect My Payment?

The COLA boost adds $2.5 for every $100 you receive. If you currently get $500, your payment will increase to $512.50. If your payment is higher, you’ll see an even bigger increase. Someone receiving $4,000 will see an extra $100 in their monthly check, bringing it up to $4,100.

The increase will be different for everyone based on how much you currently receive from Social Security. It’s important to remember that the COLA increase is designed to help everyone, no matter how much they earn.

When Should You Apply for Social Security?

If you haven’t yet applied for Social Security, it’s a good idea to wait as long as possible, especially if you haven’t reached Full Retirement Age. Delaying your application can increase the amount you receive each month because you’ll get delayed credits, which can increase your COLA as well.

When will I see the COLA increase in my Social Security payment?

If you’re on Social Security, your COLA increase will begin in January 2025. If you’re on SSI, you’ll see it starting December 31, 2024.

How much will my Social Security payment increase?

Your payment will increase by 2.5%. For every $100 you get, you’ll receive an extra $2.50 each month.

Who qualifies for SSI with the COLA increase?

You must have low income, limited resources, and be either 65 years old, disabled, or blind.

What if I haven’t applied for Social Security yet?

If you haven’t applied, you might want to wait. Delaying your application could result in higher payments, including COLA adjustments.

Will the COLA increase apply to everyone?

Most Social Security recipients will get the increase in January 2025, but SSI recipients will receive it earlier, starting December 31, 2024.

John

John's work has been recognized with several awards, including Google Fact Check 2023 Award, reflecting their dedication to journalistic integrity and excellence. They believes that local news is essential for a healthy democracy, empowering citizens with the information they need to make informed decisions.

Recommend For You

Leave a Comment