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The Social Security Administration announced its annual cost of living adjustment for 2025.
Beginning in January, benefits will increase by 2.5%, or a little less than $50 a month for the average retiree.
Here’s how to find out how much more you’ll see in your own check next year.
How to find out your 2025 Social Security COLA
The SSA will mail COLA notices to beneficiaries through the end of the year. With inflation easing throughout 2024, the Social Security cost of living adjustment came in lower than last year’s 3.2% bump.
You can find out exactly how much your benefits will increase by creating an account on SSA.gov. After verifying your account, you’ll be able to get an estimate of your retirement benefits and see how those benefits may change depending on your retirement age.
You’ll receive notice of your exact adjustment in the “messages” tab within your SSA portal. To ensure you don’t miss any news, select email or text notifications under message center preferences.
You can also crunch the numbers yourself and calculate your new Social Security benefit by multiplying the percentage increase by your current monthly benefit amount.
Say you’re receiving $1,900, which is around the current average monthly benefit for retirees. When multiplied by 2.5% or 0.025%, the estimated COLA, you can expect a monthly benefit in 2025 of about $1,955 — a $48 increase.
Making the most of your Social Security income
Leaving the workforce changes how you cover your day-to-day expenses. According to the SSA, Social Security benefits represent about 30% of the income of people over age 65, and nearly nine out of 10 Americans 65 and older receive Social Security.
With a modest monthly benefit, elevated interest rates, and higher food prices, it can be difficult for the average retired worker to make ends meet. However, there are ways you can stretch and supplement those benefits to accommodate your lifestyle.
Parking your Social Security payments, or a portion of them, in an interest-bearing account is an easy way to boost retiree benefits. In fact, many banks and credit unions are currently offering high-yield savings accounts with rates of 4% or even 5% in many cases.
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Retirees who have the ability to lock away a chunk of their monthly Social Security check might benefit from a certificate of deposit (CD). Because you’re committing to locking up your funds for a set period of time, banks and credit unions typically offer more lucrative APYs for these types of accounts.
A money market account is another type of account that generates interest, but unlike CDs, these accounts offer easier access to your funds through debit cards or check-writing privileges.
The annual COLA is based on the percentage increase in the Bureau of Labor Statistics’ Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Data from the third quarter of the last year to the third quarter of the current year is used to calculate the COLA.
How to set up an account on MySSA
Making the most of your benefit checks starts with knowing exactly how much you’ll receive. Here’s a primer on navigating the SSA website:
Setting up your My Social Security account is fairly straightforward and can be done at any point, regardless of whether retirement is months away, or years away.
Beneficiaries will need to provide your email address and at least one additional form of authentication, like a phone number or secondary email address to verify your identity.
Next, you’ll be asked for key information including your Social Security number, your full name as it appears on your Social Security card, date of birth, address, and phone number.
Once your account is set up, you can use it to manage your benefits, estimate your future benefits, request a Social Security card if you’ve lost yours, check the status of a benefits application, and more. You can also opt to receive all of your notices online, rather than by mail.