The Social Security benefits increase for seniors and other recipients could be smaller in 2025, according to a recent projection.
The annual Social Security increase, known as a cost-of-living adjustment (COLA), is expected to be 1.75%, according to a February estimate from The Senior Citizens League, a nonprofit that advocates on issues affecting seniors.
The league estimates the expected increase based on the most recent inflation data from the federal government.
Social Security increases each year are tied to inflation and meant to help seniors and other beneficiaries keep pace with rising prices.
The hike for 2024 was 3.2%, the smallest increase since 2021, when beneficiaries received a 1.3% bump.
The raise in 2023 was 8.7%, which was the highest increase in more than four decades. Beneficiaries received an increase of 5.9% in 2022.
The average raise over the last 20 years is 2.6%, according to The Senior Citizens League.
The larger increases in 2023 and 2022 came due to the highest inflation in decades, which has eased since then.
Although the raises were welcome news, The Senior Citizens League noted that the hikes don’t necessarily relieve pressure for beneficiaries.
Social Security benefits overall tend to be modest, typically replacing about one-third of a middle earner’s wages, the league said. Medicare premiums have also been rising in recent years, which swallowed at least some of the increases in Social Security benefits.
The Social Security Administration announces a cost-of-live adjustment for Social Security recipients each fall.
The 2024 increase translated into an average benefits hike of more than $50 a month. The raise took effect in January. It also boosted Supplemental Security Income benefits.
Over 71 million Americans benefited from the latest increase, according to the Social Security Administration.
First appeared on www.syracuse.com