Next year, many Social Security recipients in the United States can expect to receive benefits of nearly $60 more per month as a result of the annual cost-of-living adjustment (COLA).
That’s according to an estimate by the Senior Citizens League, which is one of the country’s largest non-partisan seniors’ groups.
What is the COLA and how does it work?
Every year, the US’s Social Security Administration (SSA) revises its monthly payments in an attempt to prevent inflation from having a negative impact on Social Security beneficiaries’ spending power.
The COLA is calculated using the Consumer Price Index for Salaried Workers in Urban Areas and Clerical Workers (CPI-W), by comparing the CPI-W in the third quarter of the prior year and the third quarter of the current year.
Social Security increase: who will benefit and when?
The COLA increase applies to all recipients of Social Security payments. In total, around 70 million people in the US receive retirement, disability, survivors or Supplemental Security Income (SSI) benefits.
According to the Senior Citizens League’s estimate, the COLA for 2024 is expected to lead to a 3.2% rise in payments. In the case of retirees, for example, this means that the current average Social Security check of $1,827 a month would go up to $1,885.
It should be noted that these are only projected figures, as the CPI-W for the third quarter of 2023 hasn’t yet been revealed. The Bureau of Labor Statistics will officially announce the COLA for 2024 in October.
Once the BLS has confirmed the COLA for next year, the increases will begin to take effect in benefits paid out in January.