The latest projections for Social Security increases in 2025 show that they will increase due to rising inflation.
support group Elderly Federation has revised its long-term forecast for the 2025 cost of living adjustment rate to 2.6%. This is up from the previous estimate of 1.75%.
This increase was due to the March consumer price index for urban salaried workers and office workers of 3.5%.
COLA in 2024 was 3.2%, significantly lower than the previous year’s 8.7%. Last year’s increase equated to an average increase of about $50 per month.
The latest projections come as costs for seniors continue to rise, said Shannon Benton, the director who oversees Social Security COLA estimates for TSCL.
“A 2.6% increase in COLA is about a $45 increase. What can you buy for that? It’s not that much,” Benton said.
According to the TSCL survey, 71% said their household spending had increased by more than the 3.2% boost. 53% said they needed to dip into their emergency savings, and 61% said food increased the most.
COLA estimates change monthly based on the latest CPI data. The final amount for 2025 will likely differ from expectations, as it will be calculated based on the average inflation rate for the third quarter (July, August, and September) and compared to the same period last year.
The group noted that six months of data still needs to be collected, leaving plenty of room for change.