We have fewer than four weeks to find out what the future of the new Social Security checks will be, and we’re going to explain why you should care. It is not only a question of how much money it will represent, but also of the overall impact after accounting for the economy’s behavior. Continue reading to learn more about the Social Security increase process and the outlook for the coming year.
How are Social Security Checks Updated?
Social Security checks are only updated once a year. The goal of this update is simple and has been the same since 1975: to limit the impact of inflation. As the economy fluctuates, prices rise and the value of money falls. As a result, over time, you can buy the same number of products and services for the same amount of money.
Although persons in the workforce bear the brunt of this problem daily, it may be managed when their incomes are modified, raised, or they simply move occupations. These modest solutions will provide them with additional funds to compensate for the gradual loss of purchasing power.
The same problem occurs with investing. Most financial consultants will advise you to seek an interest rate equal to or greater than inflation to retain the purchasing value of your wealth. However, earlier conditions are not as manageable as the funds received from Social Security checks.
Once you begin to get any type of benefit payment, there are few techniques for increasing your income from that source, let alone adjusting it to inflation within your limits. Furthermore, Social Security payments may be your sole source of income, making them even more important to your well-being.
That is why the government has put in place a mechanism to keep Social Security benefits’ buying power stable via an inflation-linked index. This indicator is known as COLA (cost-of-living adjustment). The method for calculating COLA is simple.
The costs of goods and services, as well as their changes over time, are critical pieces of information. This is accomplished through the use of a consumer price index known as CPI-W, or Consumer Price Index for Urban Wage Earners and Clerical Workers, which groups and tracks the prices of approximately 200 goods and services. These prices are then weighted based on the preferences and needs of families who earn at least 50% of their income from wage-paying or clerical jobs.
The Bureau of Labor Statistics (BLS) generates this data once a month. For COLA reasons, only the numbers for the third quarter of the year (July, August, and September) are averaged and compared to the same data points from the prior year.
This is finished in October. For this year, the only CPI-W that is unknown is for September, which will be revealed on October 10th at 8:30 AM ET. Following that, you will receive a letter announcing that the value of your Social Security benefits has increased, which normally occurs in December. On the SSA’s official website, you may verify the same information in the “Message Center” portion of your “My Social Security” account.
What is the Most Likely Value for the Social Security Checks Listed Below?
According to the most current study from The Senior Citizens League, an organization dedicated to advocating for the rights and welfare of retirees, the COLA is expected to be around 2.5%.
This refers to the drop in the inflation rate that has been observed since March 2024. Although COLA will not have a direct influence on your Social Security payments, it is a good exercise to offer a projected rise for each of the various programs:
| Program | Average Payment | Increased Payment |
| Old Age Insurance | $1,872.09 | $1,918.89 |
| Survivor | $1,509.36 | $1,547.09 |
| Disability Insurance | $1,402.69 | $1,437.76 |
| SSI (Supplemental Security Income) | $698.51 | $715.97 |