Social Security Benefits Set to Rise by 2.5% in 2025

The Social Security Administration has announced that beneficiaries will see a 2.5% increase in their benefit payments in 2025. This annual cost of living adjustment (COLA) will impact over 72.5 million Social Security and Supplemental Security Income (SSI) recipients.

New this year, beneficiaries will receive a one-page summary outlining their updated benefits and the exact date the adjustment will take effect in 2025. However, the size of the final increase may vary based on Medicare Part B premiums. For 2025, Medicare Part B costs are projected to rise to $184 per month, up from $174.70, with these premiums typically being deducted from Social Security benefits in advance.

Social Security remains a critical source of income for retirees. According to the Employee Benefit Research Institute's 2024 report, 60% of retired Americans rely on Social Security as a major part of their income. While it has been anticipated for some time that the 2025 COLA would be smaller than the more substantial increases of 2023 and 2022, it’s still essential to assess how this adjustment may affect your retirement plans.

If you’re concerned about how this increase might impact your financial outlook, please feel free to reach out. Your retirement income needs can shift over time, so it’s always wise to make any small adjustments that can help you feel more secure as we move into 2025.

CNBC.com, October 10, 2024

ThinikAdvisor.com, October 10, 2024

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