Projected 2025 Social Security COLA: What to Expect and How to Prepare
Sunday, 3 March 2024, 11:00
Expect a lower Social Security COLA than in recent years
Each month, the Bureau of Labor Statistics provides the latest inflation numbers. Those numbers include the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which the Social Security Administration (SSA) uses in its annual COLA calculation.
- Also each month, TSCL reviews the latest CPI-W data to update its forecast for the next Social Security increase. The organization now predicts that the COLA will be 1.75% in 2025. Anyone who has received Social Security benefits for a while will immediately realize that this estimated increase is much lower than what they've received in recent years.
Looking on the bright side
Keep in mind that 1.75% is only a prediction at this point. The SSA compares the average CPI-W from the third quarter of the current year with the average for the third quarter of the previous year to calculate the annual COLA.
- It's especially important to remember that Social Security increases are given after the fact. In other words, the adjustment in a given year is based on how much inflation rose in the previous year (specifically, the third quarter of that year).
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.