2024 is almost coming to an end, but it’s not going to go away without ringing its final bell first. And that is, this last month of the year, the beneficiaries of the Social Security of the United States are going to have one last “surprise”, before the new COLA percentage for 2025 comes into effect, they will receive their last check for 2024.
What is COLA?
The COLA is a small increase made by the SSA so that beneficiaries do not suffer the ravages of inflation on their own skin, so a percentage is added to each payment.
What changes with the 2025 COLA?
Starting December 31, 2024, payments will include the 2.5% increase announced by the SSA. This is based on the consumer price index (CPI-W) and reflects economic conditions between two points in the year (normally, the third quarter of the previous year and its difference with the quarter of the current year). While lower than the 3.2% in 2024 and the historic 8.7% in 2023, the increase ensures that beneficiaries can maintain their purchasing power without feeling the ravages of inflation.
For example: SSI recipients will receive their first adjusted payment of $967 on December 31, instead of the usual $943. Beginning January 8, 2025, retirees over age 70 will be able to receive up to $5,108 per month, while those who retired at age 67 will get a maximum of $4,018.
Key dates for December payments
The Social Security payment calendar is organized by beneficiaries’ birth dates:
- If your birthday is between the 1st and 10th of each month, your payment will arrive on Wednesday, December 4th (and it will be, on the first Wednesday of each month the payment will be in your bank account)
- For those born between the 11th and 20th of each month, your payment will arrive every second Wednesday of the month, in this case, it will arrive on December 18th.
- Lastly, those born between the 21st and 31st of each month will receive their payment on the third Wednesday of each month, in this case, you will receive it on December 24th (they will advance the payment because the 25th, being Christmas, is a national holiday)
The maximum amount of retirement benefits in 2024 for those who retired at age 70 will be $4,873!! Keep an eye on your bank account, your payment is coming soon!!
What can you do if you don’t receive your payment?
If your benefit doesn’t arrive on the expected date, it’s important to act immediately:
- You can check the official payment schedule on the SSA website
- If the payment is still pending, call 1-800-772-1213 to report the problem and they will try to resolve it as soon as possible.
- Document all communications and verify your bank information to rule out possible errors.
- If you need more help, contact your bank to resolve any issues (because the payment processing may have failed)
Has the COLA percentage always been the same?
No, we have already said that it varies depending on the level of inflation that exists in the country. In 2023, for example, in the midst of a bleak landscape where prices only rose, the COLA was estimated at 8.7%, crowning itself as the highest percentage in recent years. This inflation has been derived from the COVID-19 pandemic and the problems it brought.
During 2024, the percentage decreased to 3.2%, thus seeing the situation moderate (although it has not yet reached pre-pandemic levels).
By 2025, the 2.5% explains that we are approaching the usual inflation rate.
And no, it is not bad that the COLA is going down, it means that the country is on the way to economic normality, as, for example, between 2010 and 2011, when the COLA percentage was 0%.
So, now that you know what the COLA is and how it is calculated, the best thing you can do is plan your expenses for next year, taking into account that additional 2.5% to make the most of your income!