Ramsey Solutions personality Jade Warshaw breaks down how to make the most of your Social Security benefits and more on The Bottom Line.
The annual Cost of Living Adjustment (COLA) Social Security spending in 2025 is projected to be the smallest since 2021 as inflation slows.
The annual COLA, which increases a beneficiary's monthly benefit to account for inflation, is determined using the average inflation rate for July, August, and September compared to the previous year as measured by the Department of Labor's Bureau of Labor Statistics (BLS) monthly Consumer Price Index (CPI) report.
The Senior Citizens League (TSCL) estimates that, based on the Labor Department's September inflation forecast due next month, the COLA will be 2.5% in 2025. Inflation had fallen to 2.5% year-over-year through August.
TCSL said that would boost the average. Monthly Social Security Benefits The new benefit will increase by $48 to $1,920. The updated benefit will take effect for the first Social Security check in January 2025.
Social Security crisis: Recipients face 21% cut in benefits without reforms, CRFB says
The TSCL analysis estimates that the COLA for 2025 will be 2.5 percent, increasing average monthly benefits by $48. (/iStock)
A 2.5% COLA would be less than the 3.2% adjustment. Social Security recipients Growth in 2024 will be lower than expected, but roughly in line with historical rates, averaging 2.6% over the past 20 years.
“The elderly are not enough Securing food and shelter “Being able to live with dignity is the main reason we advocate for a minimum 3% COLA,” said Shannon Benton, executive director of TSCL. “TSCL research shows that nearly two-thirds of seniors rely on Social Security for more than half of their monthly income, and 28% are completely dependent on Social Security.”
BlackRock CEO says Social Security retirement age is 'a little crazy' amid looming crisis
The Social Security Administration is expected to release the official 2025 COLAs in mid-October. (Jeffrey Greenberg/Education Images/Universal Images Group/via Getty Images)
Pointing to the cost-of-living challenges facing older Americans, TSCL cited results from its 2024 Retirement Survey, which revealed that 65% of seniors have expenses of at least $2,000 per month, up from 55% in 2023.
The study found that compared to 2023, more seniors will be spending more than $4,000 or $6,000 a month, while fewer will be able to get by on less than $1,000.
Click here to get FOX Business on the go
Additionally, nearly 80% of elderly households surveyed said their monthly budget for daily necessities had increased over the past 12 months, and 63% said they were concerned that their income would not be enough to cover basic expenses in the coming months.
The Social Security Administration (SSA) is scheduled to release the official COLAs for 2025 in mid-October after the Department of Labor releases its September inflation data.
