when will social security announce cola for 2025

Vender Womder

2 min read

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23-11-2024

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When Will Social Security Announce the COLA for 2025?

The annual Social Security cost of living adjustment (COLA) is a significant event for millions of retirees and beneficiaries. This adjustment, reflecting the previous year's inflation, impacts the monthly benefits received. Many are eager to know when the Social Security Administration (SSA) will announce the COLA for 2025.

The Announcement Timeline:

The SSA typically announces the COLA for the following year in October. This announcement follows the release of the Consumer Price Index for Wage Earners and Clerical Workers (CPI-W) data for the third quarter (July, August, and September). The CPI-W is the key inflation metric used to calculate the COLA.

Therefore, expect the official announcement of the 2025 COLA sometime in October 2024.

Factors Influencing the COLA:

Several factors influence the final COLA percentage:

• Inflation Rate: The primary driver is the average increase in the CPI-W over the third quarter of the prior year compared to the third quarter of the year before that. Higher inflation generally leads to a larger COLA.
• CPI-W Calculation: The SSA uses a specific formula to calculate the COLA based on the CPI-W data. This formula involves comparing the average CPI-W for the third quarter of the current year to the average for the third quarter of the previous year. Any increase in the CPI-W results in a corresponding COLA increase.

Where to Find the Official Announcement:

Once the COLA is announced, you'll find the official information on the Social Security Administration's website (ssa.gov). Look for press releases and updates on their news section. You can also sign up for email alerts from the SSA to be notified directly.

What to Expect:

While the exact percentage is unknown until the official announcement, analysts and economists often provide projections based on current economic trends. These projections, however, should be viewed with caution as they are not definitive.

Beyond the Announcement:

The COLA announcement isn't just about the number itself. Understanding the impact of the COLA on your benefits is crucial. After the announcement, it's helpful to:

• Review your benefit statement: Check your updated benefit amount after the COLA takes effect in January.
• Plan your budget: Adjust your budget to reflect the change in your Social Security income.
• Seek guidance if needed: Contact the Social Security Administration or a financial advisor if you have any questions about the COLA or your benefits.

In conclusion, while we await the official October 2024 announcement, understanding the process and where to find reliable information will help you prepare for the changes in your Social Security benefits. Stay informed and plan accordingly. Keep an eye on ssa.gov for the official announcement of the 2025 COLA.