Social Security Benefits Increase Projection for 2025 Indicates Smaller Raise Ahead

A recent projection by The Senior Citizens League suggests that the annual cost-of-living adjustment (COLA) for Social Security benefits in 2025 could be smaller than previous years, with an expected increase of 1.75%.

The projection is based on the most recent inflation data from the Consumer Price Index for Urban Wage Earners and Clerical Workers, which currently stands at 2.9%.

According to The Senior Citizens League, the COLA estimate fluctuates monthly based on CPI data, with the final determination likely in the third quarter of the year.

The projection of 1.75% from TSCL contrasts the Congressional Budget Office’s estimate of 2.5%, indicating an overall expectation for lower inflation rates in 2025 compared to recent years.

If the 1.75% projection holds, it would represent the smallest increase since 2021 when the COLA was 1.3%, following significant jumps in 2022 (8.7%) and 2021 (5.9%).

The Senior Citizens League noted that while the recent raises were significant, Social Security benefits remain modest overall, typically replacing about one-third of a middle earner’s wages.

The rise in Medicare premiums in recent years has offset some of the increases in Social Security benefits, impacting beneficiaries’ purchasing power.

With over 71 million Americans benefiting from the latest increase announced in 2024, the Social Security Administration’s upcoming 2025 adjustment is anticipated to affect a substantial portion of the population.