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SOCIAL SECURITY BENEFIT INCREASE FOR 2025 PREDICTION

 

I am predicting a Cost of Living Adjustment (COLA) of 2.5 percent for 2025.

If this prediction holds up, Social Security recipients will have an extra $2.70 for each one hundred dollars in benefits. For example, if your 2024 benefit amount is $1,500 per month, your 2025 benefit would increase to about $1,539. (*)

How does Social Security calculate the COLA each year?

The actual increase is based on the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers from the third quarter of the previous year. The calculation is usually made in October, announced in December, and goes into effect in January.

So, the actual COLA will be calculated in October, 2024 and announced in December 2024. It will go into effect January, 2025. The amount may be lower or higher than our prediction.

*Disclaimer: We are making our estimate on very early inflation indications. No one should make any financial plans or decisions based on a potential COLA until the government announces the actual COLA, if there is one. The actual COLA could be more or less than we have predicted. The 2024 COLA was 3.2 percent--unusually high due to higher inflation in the third quarter of 2023.

UPDATE:  On October 10, 2024 Social Security announced a 2.5 percent COLA increase for recipients.  This will amount of an increased benefit of abut $48 per month on the AVERAGE benefit.


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