Social Security Recipients Getting a 2.5% Boost in 2025

It’s a smaller increase than the average over the last decade, but more than 72.5 million Americans are going to get a 2.5% cost-of-living allowance increase in their Social Security benefits next year.

The Social Security Administration announced the increase earlier this week. On average, Social Security retirement benefits will increase by about $50 per month starting in January.

Over the last decade the COLA increase has averaged about 2.6 percent. The COLA was 3.2 percent in 2024.

Recipients received a 3.2% increase in their benefits in 2024, after a historically large 8.7% benefit increase in 2023, brought on by record 40-year-high inflation, the Associated Press reported.

The smaller increase for 2025 reflects moderating inflation.

Social Security Commissioner Martin O’Malley told The AP the upcoming increase will provide a measure of relief for recipients as inflation has cooled and the agency serves a record number of retirees while funding is at a historic low.

His message to those who feel that the adjustment is not enough: “They’re not wrong.”

”I’ve heard the stories and it is a struggle for seniors,” he told the AP, adding that “in their older years, they have to spend their money on a different array of costs and expenses, including prescription drugs.”

Social Security beneficiaries will see the 2.5% cost-of-living adjustment (COLA) beginning in January 2025.  Increased payments to nearly 7.5 million people receiving SSI will begin on December 31, 2024. (some people receive both Social Security benefits and SSI).

“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,” said Martin O’Malley, Commissioner of Social Security.

Some other adjustments that take effect in January of each year are based on the increase in average wages.  Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) is slated to increase to $176,100 from $168,600.

Social Security begins notifying people about their new benefit amount by mail starting in early December.

Individuals who have a personal my Social Security account can view their COLA notice online, which is secure, easy, and faster than receiving a letter in the mail. People can set up text or email alerts when there is a new message–such as their COLA notice–waiting for them in my Social Security.

People will need to have a personal my Social Security account by Nov. 20 to see their COLA notice online. To get started, visit www.ssa.gov/myaccount.

Information about Medicare changes for 2025 will be available at www.medicare.gov. For Social Security beneficiaries enrolled in Medicare, the 2025 benefit amount will be available via my Social Security’s Message Center starting in late November. Those who have not opted to receive messages online will receive their COLA notice by mail in December.