Millions of Americans are eagerly awaiting the release of the 2025 cost of living adjustment (COLA) for Social Security benefits.
As of October 10th, beneficiaries will learn the new percentage increase, which will be reflected in their payments starting in January. This adjustment is crucial as it helps retirees, survivors, and those on disability keep up with inflation.
Who Will Receive the First Payment?
The Supplemental Security Income (SSI) program beneficiaries will be the first to receive the new 2025 Social Security benefits.
Because January 1st is a holiday, SSI recipients will see the increased payments on December 31st, 2024. SSI payments vary based on income, assets, and filing categories.
New SSI Payments in December 2024 (with 2.5% COLA increase):
| Category | Current SSI Amount | New SSI Amount (Estimated) | Increase |
|---|---|---|---|
| Average | $698 | $715 | $17 |
| Individuals | $943 | $967 | $24 |
| Couples | $1,415 | $1,450 | $35 |
| Essential Person | $472 | $484 | $12 |
What Does This Mean for Social Security Recipients?
Once SSI recipients are paid, the Social Security Administration will begin delivering the new benefits to other recipients, including retirees, survivors, and disabled individuals. When you receive your payment will depend on when you first claimed your Social Security benefits:
- If you claimed before May 1997: You will receive your new payment on January 3rd, 2025.
- If you claimed after May 1997: The date depends on your birth date:
- Born between the 1st and 10th: You’ll receive payment on January 8th.
- Born between the 11th and 20th: You’ll receive payment on January 15th.
- Born between the 21st and 31st: You’ll receive payment on January 22nd.
How Much Will You Receive with the 2.5% COLA?
Though the official percentage will be confirmed in October, estimates from the Senior Citizens League suggest a 2.5% increase.
Here’s how much retirees, survivors, and disabled individuals might expect to see in their checks starting in 2025:
Estimated Retirement Benefits for 2025:
| Age | Current Benefit | New Benefit (2.5% Increase) | Increase |
|---|---|---|---|
| On Average | $1,900 | $1,948 | $48 |
| Age 62 | $2,710 | $2,778 | $68 |
| Age 67 | $3,822 | $3,918 | $96 |
| Age 70 | $4,873 | $4,995 | $122 |
Estimated Survivor Benefits for 2025:
| Category | Current Benefit | New Benefit (2.5% Increase) | Increase |
|---|---|---|---|
| On Average | $1,505 | $1,543 | $38 |
| Individual | $1,773 | $1,817 | $44 |
| Two Children | $3,653 | $3,744 | $91 |
Estimated Disability Benefits for 2025:
| Category | Current Benefit | New Benefit (2.5% Increase) | Increase |
|---|---|---|---|
| On Average | $1,537 | $1,575 | $38 |
| Blind Recipients | $2,590 | $2,655 | $65 |
| Maximum Payment | $3,822 | $3,918 | $96 |
Retirement Age May Increase
In recent years, there has been a growing concern about the long-term sustainability of the Social Security program. The Congressional Budget Office (CBO) has warned that Social Security could run out of funds by 2033 if no changes are made. One of the proposed solutions is to raise the average retirement age.
Currently, most Americans retire at age 62, but many expect to work until 67. Surveys show that 56% of retirees choose to retire earlier than planned. In fact, 38% of early retirees cite health problems or disabilities as reasons for early retirement. If the retirement age is raised, it could result in reduced lifetime Social Security benefits for future retirees.
This change would affect how long beneficiaries can claim their benefits. For example, if the full retirement age (FRA) is raised, individuals who delay retirement would receive payments for fewer years. This change, while improving Social Security’s financial outlook, could reduce the overall benefits for those affected.
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Summary
As we approach the release of the official COLA adjustment, millions of Social Security and SSI beneficiaries are eager to see how much their benefits will increase.
While the 2.5% COLA estimate is promising, it’s important to stay informed about potential changes to the retirement age and other Social Security adjustments that may impact future beneficiaries.
Eliot Pierce is a dedicated writer for ChiefsFocus.com, covering local crime and finance news. With a keen eye for detail and a passion for storytelling, Eliot aims to provide his readers with clear and insightful analysis, helping them navigate the complexities of their financial lives while staying informed about important local events. His commitment to delivering accurate and engaging content makes him a valuable resource for the community.