Starting in January the average monthly check for the nation’s 72.5 million Social Security benefit recipients will be $1,976,¹ up 2.5%² from 2024. That’s an increase of $50 a month, on average.

But for some retirees, the modest increase is lower than expected: According to AARP research, 83% of older adults said that a cost-of-living adjustment of less than 3% wouldn’t be enough to offset rising prices.³

Why is Social Security going up?

When costs heat up, COLAs do as well.

Every year since 1975, Social Security benefits have been reviewed and recalculated to help keep pace with inflation. It’s a way to protect the purchasing power of payments so they don’t lose their strength when things become more expensive. But if there’s no inflation, like in 2009, 2010 and 2015, there’s no COLA.

The Social Security Administration (SSA) analyzes data from the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) to set the annual COLA. In general, the CPI-W measures the average cost changes for a variety of common products and services, like food, clothing and transportation. If there is at least a 0.1% increase when comparing third-quarter numbers with the same period from the previous year (July, August and September), Social Security benefits will see some sort of spike.⁴

The largest jump in history occurred back in 1980 when the COLA skyrocketed to 14.3%.⁵

Will I get more from Social Security in 2025?

It depends. Seventy percent of people elect to have their Medicare Part B premiums automatically deducted from their Social Security checks.⁶ If you fall into this group, there is a chance a Medicare rate hike could offset any extra you receive from a cost-of-living adjustment.

The Centers for Medicare & Medicaid Services (CMS) announced that the standard monthly premium for Medicare Part B for 2025 will be $185. That $10.30 difference amounts to a 5.7% increase over 2024’s figure of $174.70.⁷

Will a bigger benefit be enough to fund my retirement?

Around 1 in 5 U.S. residents receive Social Security benefits, though Social Security was never designed to be a person’s sole or most prominent source of retirement income.^8,9 Many financial professionals suggest that an amount around 80% of your annual income can cover your cost of living in retirement, and Social Security should help with a portion of that because it’s based on your total lifetime earnings. It’s a good idea to contribute to a 401(k) plan, an IRA, or another tax-advantaged type of investment account to help grow your nest egg.  

What if I don’t plan on collecting Social Security in 2025?

You can begin collecting Social Security checks as early as age 62. But if you’re not ready to file in 2025, you may get the best of both worlds. Not only will your benefits be higher the longer you wait to claim, but you’ll also be able to benefit from next year’s estimated COLA increase. That’s because inflation adjustments are automatically factored into future payments.¹⁰

Where can I access my Social Security account?

You can visit ssa.gov to manage your account or, if you haven’t already, create a username and password. Once you’re logged in, you’ll be able to view your profile page, earnings history, and estimated benefits.