Social Security COLA 2024: How much benefits could increase

Annual cost-of-living adjustments based on inflation increased benefits for Social Security and Supplementary Security Income (SSI) recipients by 8.7% in 2023, the highest since 1981.

2023 cola raised the average social security retirement benefit That’s a savings of about $146/month.

Now, John and other VERIFY readers are asking if 2024’s COLA is expected to be as good as 2023’s.

question

Is Social Security’s next Cost of Living Adjustment (COLA) expected to be similar to 2023?

source of information

answer

No, Social Security’s next Cost of Living Adjustment (COLA) isn’t expected until 2023. However, Social Security beneficiaries will still see an increase in their monthly benefit payments.

what we found

The Social Security Administration (SSA) adjusts benefits annually for inflation through the Cost of Living Adjustment (COLA). SSA is 2024 COLA announced in October.

COLA is expected to be about 3% in 2024, based on projections by two social security experts.

The latest estimates of the Federation of the Aged COLA in 2024 is 3%. Alicia Munell, director of the Center for Retirement Studies at Boston University, said: In late July, it said it expected the COLA to be 3.4% in 2024..

These estimates are subject to change based on monthly inflation data.

The estimated 2024 COLA is significantly lower than the 8.7% increase beneficiaries experienced in 2023. This is because inflation spiked in his 2022 but started to normalize again this year.

If the 3% estimate holds true, the COLA will increase further. Average Social Security Benefit Payments for Retired Workers In 2024, it will increase by about $55 per month.

How COLA is calculated

cola calculated based on increase rate of Consumer Price Index (CPI-W) for urban wage earners and clerical workers, the inflation gauge as measured by the U.S. Bureau of Labor Statistics (BLS). It measures the average change over time in the prices workers are paying in their ‘basket of consumer goods and services’.

SSA explain COLA is equal to the percentage increase in CPI-W from last year’s third quarter average to this year’s average. If there is an increase, it is rounded to the nearest tenth of a percent. The same increase applies to your monthly Social Security payments.

To determine the 2024 COLA, SSA compares the July, August, and September 2022 CPI-Ws to the same period in 2023.

CPI-W in July 2023 increased by 2.6% annually. BLS data show. Data for August and September have not yet been released.

Cola SSI programprovides monthly payments to disabled adults and children with limited income and resources, usually the same as Social Security benefits, but usually in the month following an increase in Social Security benefits. takes effect. SSA says on its website:.