The 3.2% COLA for security benefits is scheduled for 2024 in an effort to combat inflation. Though Medicare rates are rising and pensioners are facing serious financial difficulties, questions remain over the adequacy of this increase. Concerns regarding seniors’ spending power have increased as early estimates for 2025 point to a lower COLA.
Social Security Benefits For Retirees
For the past several decades, Social Security benefits have provided over 71 million Americans retirees, veterans, and their dependents with essential financial support. Created in 1973, the COLA has been applied annually since 1975 to help these payments keep pace with inflation. This change has, in large part, maintained the purchasing power of Social Security payouts against rising costs.
In 2024, the 3.2% COLA increase was fixed, which resulted in a little increase in beneficiaries’ monthly payouts. This move was made to help recipients deal with the rising cost of living, particularly in view of the difficulties that inflation has recently presented. However, there have been questions about whether this increase will be enough to maintain purchasing power, especially for those on fixed incomes.
Increase In Social Security COLA
Initial estimates for 2025 showed that the COLA will increase by 2.57%. If confirmed, Social Security recipients would get an extra $50 a month on average. While this change would provide some comfort, experts are concerned that it might not be enough to meet seniors’ financial needs.
An further financial burden on retirees could come from the projected rise in Medicare Part B rates. These rates have been steadily increasing often more quickly than COLA changes to cover medical expenses and outpatient care. So, when Medicare premiums are deducted from Social Security income, the net benefit increase for many seniors may be slightly lower.
Monthly Payments Of Social Security Benefits
The overall amount of taxes paid, the number of years of employment, and the retirement age all influence Social Security benefits. The average monthly payments for the various beneficiary categories as of 2024 were as follows:
- About $1,907 was given to retired workers each month.
- Couples in retirement who filed jointly took home about $3,303 a month.
- The average monthly survivor benefit was $1,509.50.
- On average, retired workers’ spouses made $910 a month.
- An average of $892.39 was given to retired workers’ children each month.
- Individuals who received Supplemental Security Income (SSI) were paid an average of $943 per month.
- Couples that received SSI benefits were typically paid $1,415 a month.
