Every year at the start of a new year, the US government changes Social Security checks to reflect the cost of living.
This change is meant to directly fight price inflation, making sure that senior Americans can keep paying their bills without having to worry about money.
The main goal of the COLA is to keep seniors’ ability to buy things. Without this change, many Americans would have a hard time with rising prices, which could put their financial safety at risk.
This small rise every year helps make sure that retirees and other beneficiaries do not lose their money because of inflation.
It is important to note that the COLA does not just affect Social Security retirement payouts; it also affects other checks, like Supplemental Security Income (SSI).
2025 COLA Increase: How Early Payments Will Increase Retirees’ Purchasing Power
The Social Security Administration has stated that the first COLA payments will be sent out early in 2025, which is very exciting. In other words, if you qualify, you can expect to get your adjusted check sooner rather than later, which will give you a welcome cash boost.
- Helps fight inflation
- Makes sure that seniors can still buy things
- It works for both Social Security and Supplemental Security Income
- Payments made early for the 2025 COLA
If you qualify, all you have to do is wait for your check to arrive and enjoy the extra money without any trouble. The COLA is an important way to protect the financial health of older people, which makes each new year a little easier to handle.
Understanding the First Social Security Payment of 2025
The January Supplemental Security Income (SSI) payment is the first official payment from Social Security in 2025. It includes the Cost of Living Adjustment (COLA).
These perks are usually given out on the first of every month. If the 1st happens on a holiday or weekend, though, the payment is moved to the business day before.
January 2025 Payment Schedule
As of January 2025, January 1 is a holiday. This means that the Supplemental Security Income check will be sent to December 31, 2024 now. The 2025 COLA will be part of this early payment, even though it is due in 2024.
What to Expect from Your January SSI COLA Payment
Today, the largest amount will not be $943 as usual. It will be that amount plus the COLA for 2025 instead.
With the COLA going up by about 2.5% in 2025, you should add this amount to your monthly SSI check and other Social Security payments.
- Due date: December 31, 2024
- January 2025 is included. COLA
- The expected rise is about 2.5%.
What the COLA Increases Have Been Over the Last 7 Years in the United States
- 2019.28% – This change was made to account for moderate inflation, which gave beneficiaries a small boost in their payments.
- 2020: 1.6 percent—a smaller rise than the previous year, which is in line with the lower inflation rates that year.
- 2021: 1.3% – This was one of the lowest COLA raises, which means that inflation had a small effect on the cost of living.
- 5.9% in 2022 – This was a big jump from previous years. The cost of things and services went up because inflation rates were going up.
- 8.7% in 2023—the biggest increase in decades. This big change was made to help recipients deal with the sharp rise in inflation and the rising cost of living.
- 2024: 3.2%—a moderate rise that reflects a cooling inflation situation while still addressing concerns about the cost of living.
- 2.05% in 2025: With a lower inflation rate, this smaller rise is meant to keep purchasing power steady.
How is the COLA Calculated Each Year?
Measuring Inflation with the CPI-W:
The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) is what the Social Security Administration (SSA) uses to figure out the COLA.
The Bureau of Labor Statistics (BLS) makes the CPI-W, which shows changes in the prices of a market basket of goods and services that salary earners and office workers in cities usually buy.
Determining the Comparison Periods:
- This year’s average: The SSA figures out the CPI-W average for the third quarter (July, August, and September) of this year.
- In order to figure out the COLA, the SSA looks at the average CPI-W for the third quarter of the previous year. Unless there was no COLA, this is usually the year before.
If the CPI-W has gone up, the COLA number is rounded up to the tenth of a percent. This percentage rise is applied to benefits that start in December of this year and are paid out in January of the next year.