NATIONWIDE — Social Security benefits and Supplemental Security Income (SSI) payments for more than 72.5 million Americans will increase 2.5 percent in 2025, the Social Security Administration announced recently. On average, Social Security retirement benefits will increase by about $50 per month starting in January.

Over the last decade, the cost of living increase has averaged about 2.6 percent. The increase was 3.2 percent in 2024.

Nearly 68 million Social Security beneficiaries will see a 2.5 percent cost-of-living adjustment (COLA) beginning in January 2025.  Increased payments to nearly 7.5 million people receiving SSI will begin on December 31, 2024. (Note: Some people receive both Social Security benefits and SSI).

Some other adjustments that take effect in January of each year are based on an increase in average wages.  Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) is slated to increase to $176,100 from $168,600.

Social Security will begin notifying people about their new benefit amount by mail starting in early December.

This year, for the first time, Social Security beneficiaries will receive a simplified COLA notice. It is now only one page, uses plain and personalized language, and provides exact dates and dollar amounts of a person’s new benefit amount and any deductions.

Individuals who already have a personal My Social Security account can view their COLA notice online, which is secure, easy and faster than receiving a letter in the mail, the administration said. 

People can set up text or email alerts for when there is a new message waiting for them in My Social Security.

Information about Medicare changes for 2025 will be available at www.medicare.gov. For Social Security beneficiaries enrolled in Medicare, the 2025 benefit amount will be available via My Social Security’s message center starting in late November. 

Those who have not opted to receive messages online will receive their COLA notice by mail in December.

The Social Security Act ties the annual COLA to the increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) as determined by the Department of Labor’s Bureau of Labor Statistics.

To read more, visit www.ssa.gov/cola.