The Social Security Administration (SSA) announced a 2.5% Cost-of-living Adjustment (COLA) for 2025 in an October 10 press release, increasing Social Security and Supplemental Security Income (SSI) payments for over 72 million Americans. Based on inflation data, the SSA announces COLA hikes every year in October to help Social Security recipients fight inflationary pressures and rising living costs.
The SSA projected that COLA for 2025 will increase Social Security checks for retirees by an average of nearly $50 monthly to $1,976, effective January 2025. Elsewhere, over 7 million receiving SSI checks will see bigger payments starting New Year's Eve. "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," stated Social Security Commissioner Martin O'Malley in the press release.
The 2025 COLA announcement marks the lowest annual increase in Social Security payments since 2021. For 2024, SSA issued a COLA hike of 3.2% and 8.7% for 2023. The 2025 COLA hike can prove disappointing for retirees grappling with elevated inflation and relying on Social Security checks to get by. The reduced income hike can be attributed to several factors, including a steadily cooling inflation trend, a subsequent 50 basis points rate cut by the US Federal Reserve, and long-term challenges facing the Social Security Trust Fund, expected to be depleted by the mid-2030s until the US Congress intervenes.
Monthly Social Security Payments For Some Increase By $100
According to an SSA fact sheet published today, the maximum monthly Social Security income for US workers hanging up their boots at the full retirement age in 2025 increased to $4,018 from $3,822 in 2024. The full retirement age is 67 for people born after 1960. Meanwhile, the maximum monthly SSI payments for individuals will jump year-over-year by $24 in 2025 to $967 from $943. For couples, the maximum SSI monthly check also increases to $1,450. SSI payments help people with low or no income/resources who are blind, aged 65 or above, or have a disability pay for basic living costs. To be eligible, you must be between 18 and 65 years old, live in a US state, and have assets of no more than $2,000 for individuals and $3,000 for couples. Meanwhile, widowed mothers with two children receiving Social Security payments will also see an impressive increase in the average monthly checks by nearly $100 to $3,761.
SSA To Issue Newly-Designed COLA Notice For Recipients
The SSA has decided to mail beneficiaries a one-page, simplified COLA notice in simple language starting next month. The notice will detail important dates, benefit amounts, and deductions, if any. The new notice is expected to help recipients easily find the required information. Meanwhile, beneficiaries with personal Social Security accounts can securely access their COLA notices online.
