The Social Security Administration (SSA) has announced that it will be raising the amount of benefits that recipients receive by 2.5%, based on the Cost of Living Adjustment (COLA). This means that the more than 70 million people who receive benefits through the SSA, including people who receive Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI), will see a slight increase in the money they receive. These adjustments will take place starting on December 31, 2024.
What is the Cost of Living Adjustment (COLA)?
In simple terms, the Cost of Living Adjustment is an automatic increase in benefits applied to payments from the SSA that is intended to help it keep up with changes in the cost of living. This is because prices for important goods and services can increase over time, and the COLA helps these benefits keep up. This allows things like SSDI and SSI to keep up with economic shifts without needing congressional action.
How Is the COLA Calculated?
The COLA is calculated using something known as the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This is a measurement of a basket of common goods and services that most people need to pay for to maintain their standard of living. Generally speaking, the COLA is adjusted each year to keep up with changes in the CPI-W.
Why Has The COLA Increased?
This year, the COLA increased by 2.5%, which is a fairly modest increase compared to the past few years, and is much more in line with increases between 2001 and 2020. For example, back in 2022, the COLA was at 5.9%, and in 2023, it rose as high as 8.7%. This is due to a general decline in inflation, which has led to the cost of goods and services evening out.
How Could This Impact You?
For people who are already receiving SSDI and SSI benefits, this means that their payments will see a small but significant increase compared to 2024. For people who are seeking these benefits, however, the COLA adjustment is an assurance that payments will keep up with changes in the cost of living. That way, they can focus on what really matters, rather than worrying about whether their payments will be unable to keep up with their expenses.
If you or a loved one need assistance applying for SSDI or SSI benefits, it is important that you seek the guidance of an experienced Social Security Disability benefits lawyer. The lawyers at Sullivan & Kehoe, LLP have over 50 years of combined experience between its attorneys and are available to you or your loved one in obtaining Social Security Disability or Supplemental Security Income benefits. To schedule a consultation with our New York Social Security Disability benefits lawyers, call (631) 823-7155.
