At the least, retired workers will benefit from another Cost-of-Living Adjustment (COLA) raise in 2025, which probably won’t come close to matching the 3.2% adjustment increase in 2024 and considerably less than the magnificent 5.9% increase instituted in 2022, maybe attributable to inflation and other similar incidents.
Immediate effect on retirees
The average monthly check will rise from $1,927 in 2024 to $1,976 in 2025-an increase of $49. For couples receiving benefits, the average increase will rise from $3,014 in 2024 to $3,089 in 2025. Such increases have not been considerable:
- 2023, record increase of 8.7%, increase in the basic pay from $1,681 up to about $1,827.
- 2022 increase of 5.9%, the highest increase since before 1982.
What will this mean in terms of beneficiaries?
True, any increase is a boon, but a mere 2.5 adjustment-set against prices of necessities-may not offset the related increase. According to the Bureau of Labor Statistics, the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) recorded a 4.2% increase in necessities in the last 12 months, thus indicating the further erosion of purchasing power for many retirees.
Still, since 1975, the Social Security Administration has used the CPI-W from the third quarter of the previous year to set its adjustments for the Cost-of-Living Adjustment (COLA). For 2024, the figure was 4.6%, and for 2025, it appears lower due to drops in inflation. There is a clear connection between COLA applications and the economic fluctuations of the country.
