On average, the Social Security COLA for the year 2025 will be higher for retired workers aged 70, the Department of Labor released inflation data for September, and shortly thereafter the Social Security Administration (SSA) made the announcement of the official adjustment of the Cost of Living (COLA) for 2025. The Social Security Administration announced yesterday that the Social Security cost of living adjustment for 2025 will be 2.5%. The annual adjustment, COLA, helps the payments of more than 72 million citizens, the vast majority of them already retired, to keep pace with price increases. As inflation has largely declined from its peak in recent years, the 2025 COLA is lower than it has been lately.
It is 0.7% less than the 2024 COLA, which was 3.2%, and significantly less than the large 8.7% increase that beneficiaries received in 2023. “Social Security benefits and SSI payments will increase in 2025, helping handfuls of people keep up with spending even as inflation has begun to cool,” Social Security Commissioner Martin O’Malley said in a news release.
How much money will beneficiaries receive next year thanks to the COLA increase
Beneficiaries will receive this increase in their Social Security benefits starting in January 2025, as the cost of living adjustment (COLA) for next year has finally been set at 2.5%. Considering this annual increase, beneficiaries of the Retirement, Survivors, and Disability Insurance (RSDI) and Supplemental Security Income (SSI) programs will receive the following payment amounts per program:
- Retirement benefits (plus 2.5%) On average: $1,948
- Age 62: $2,778
- Age 67: $3,918
- Age 70: $4,995
- Survival benefits (plus 2.5%)
- On average: $1,543
- Individual: $1,817
- 2 children: $3,744
- SSDI benefits (plus 2.5%)
- On average: $1,575
- Blind recipients: $2,655
- Maximum payout: $3,918
- SSI benefits (plus 2.5%)
- On average: $715
- Individuals: $967
- Couples: $1,450
- Essential person: $484
How much will Retirees receive with the COLA
Retirees aged 70 will receive the highest COLAs in nominal dollars in 2025. The average Social Security benefit for retired workers was $1,920 in September 2024. That figure will increase by $48 the following year in the event of an adjustment of the cost of living (COLA) of 2.5%.
However, retirees with above-average benefits will receive a nominal COLA in larger dollars, meaning their payments will increase by more than $48. Likewise, retirees with below-average benefits will receive nominal COLAs in smaller dollars, meaning their payments will increase by less than $48.
- Age 62: $1,311
- Age 63: $1,344
- Age 64: $1,436
- Age 65: $1,583
- Age 66: $1,774
- Age 67: $1,894
- Age 68: $1,947
- Age 69: $1,971
- Age 70: $2,068
- Age 71: $2,057
- Age 72: $2,044
- Age 73: $2,011
- Age 74: $2,002
- Age 75: $2,013
- Age 76: $1,998
- Age 77: $2,004
- Age 78: $1,972
- Age 79: $1,954
- Age 80: $1,946
According to the chart above, retired workers who are age 70 as of June 30, 2024 will receive the largest cost-of-living adjustments in nominal dollars next year. This is because they already receive the highest Social Security benefits.
Think about it this way: if the average benefit for a retired worker at age 70 is $2,068 per month and the Social Security COLA for 2025 is 2.5%, then the average 70-year-old worker will receive $51, 70 additional monthly next year. No other age group has a large base benefit, so no other age group is going to receive a higher COLA.