Recipients of Social Security checks and veterans benefits payouts could see a cost-of-living adjustment of less than 3% in 2025, the lowest mark since before the COVID-19 pandemic, according to an independent watchdog group.
Officials from the Senior Citizens League — an affiliate of TREA: The Enlisted Association — last week announced their latest projection for Social Security COLA rates for the upcoming year, estimating the figure will be less than 2.6%.
In a statement, the group said that figure is “substantially lower” than the 3.2% adjustment that was implemented at the start of 2024. The cost-of-living adjustment rate hasn’t been below 3% since early 2020, when it was down to 1.3%.
Social Security officials typically announce their cost-of-living calculations for the coming calendar year in early October.
In recent years, estimates unveiled by the Senior Citizens League’s in late summer have come within a percentage point of the official adjustment mark.
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The Social Security announcement is of particular interest to veterans because Congress annually ties the increase in veterans payouts to the Social Security Administration’s calculations.
About 5 million veterans and 2 million military retirees receive benefits checks each month through the Department of Veterans Affairs. The COLA-increase would apply to payouts for disability compensation, clothing allowances, and dependency and indemnity benefits, as well as some other Veterans Affairs assistance programs.
For a veteran receiving $1,500 a month in disability payouts, a cost-of-living adjustment of 2.6% would mean an extra $39 each month. In 2023, that figure soared to 8.7%, or about $130 a month for that same veteran.
Social Security officials calculate the annual cost-of-living adjustment based on the Consumer Price Index for Urban Wage Earners and Clerical Workers. If those laborers don’t see a rise in their annual salaries, federal planners can determine that no adjustment is needed.
However, Senior Citizens League officials said the government’s “failure to return inflation to pre-pandemic levels” has put additional pressure on seniors and veterans benefits recipients, making the size of the adjustment crucial for many the financial health of many households.
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