Social Security Announces 2.5 Percent Benefit Increase for 2025

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The Social Security Administration (SSA) announced today that Social Security benefits and Supplemental Security Income (SSI) payments will increase by 2.5 percent in 2025, benefiting over 72.5 million Americans. This cost-of-living adjustment (COLA) will provide much-needed financial relief for millions as inflation begins to ease.

Starting in January 2025, Social Security retirement beneficiaries will see an average increase of about $50 per month. Additionally, approximately 7.5 million SSI recipients will start receiving increased payments as early as December 31, 2024. The COLA, designed to help Americans keep pace with rising living costs, comes as the latest in a decade of annual increases, which have averaged 2.6 percent. The 2024 increase was slightly higher at 3.2 percent.

Other key changes taking effect in January 2025 include an adjustment to the maximum amount of earnings subject to Social Security tax, which will increase from $168,600 to $176,100 due to rising average wages.

Starting in early December, beneficiaries will receive letters outlining their new benefit amounts. For the first time, Social Security is introducing a simplified, one-page COLA notice that uses clear, personalized language. This new format will make it easier for recipients to understand their updated benefits and any deductions. Those who have a personal my Social Security account can access their COLA notice online, a faster and more secure option than waiting for mail.

To view their updated benefits online, individuals must create a my Social Security account by November 20, 2024. Visit ssa.gov/myaccount to sign up and receive alerts about changes, including the 2025 COLA notice.

Medicare changes for 2025 will be available at medicare.gov, and Social Security recipients enrolled in Medicare can find their updated benefit amounts in the my Social Security Message Center starting in late November. Those without online access will receive their notices by mail in December.

The annual COLA is tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), as determined by the Bureau of Labor Statistics. This ensures that Social Security and SSI benefits adjust in response to changing living costs, providing critical financial support to those who need it most.

For more details on the 2025 COLA, visit ssa.gov/cola.