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The Social Security Administration announced Thursday that more than 72.5 million Americans will receive a 2.5% cost-of-living adjustment to their benefits in 2025.
The change will increase Social Security retirement benefits by about $50 a month on average starting in January, the agency said.
Social Security Administration first announced the change Feed X through its newsroom and confirmed the news to CNBC by phone Thursday morning.
Social Security cost-of-living adjustments in 2025 had the lowest annual rate of increase since 2021, when beneficiary benefits increased by 1.3%. COLAs have expanded in recent years in response to record high inflation.
The cost-of-living adjustment was 3.2% in 2024, but beneficiaries saw benefit increases of 8.7% in 2023 and 5.9% in 2022, the highest in 40 years.
The pace of inflation is now lower and cost of living adjustments are more average. Annual Social Security benefits have increased by an average of about 2.6% over the past 20 years, according to the Federation for Senior Citizens, a nonpartisan seniors organization.
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