The Social Security Administration has determined that certain states may see higher hikes than others by 2025. Every year, the SSA increases Social Security payments so that beneficiaries can benefit from the cost-of-living adjustment (COLA).
The COLA is intended to help seniors maintain their spending power even when the cost of goods and services rises, by accounting for inflation on some items. The Senior Citizens League predicted earlier this week that the cost-of-living increase for next year would be around 2.6%.
Since 2021, this would be the beneficiaries’ smallest increase. However, not all states see the same kind of benefit increases each month.
Social Security Has Announced That Some Pensioners Will Receive Higher Payouts in Certain Jurisdictions
Because of the way Social Security is calculated, not all states will experience monthly benefit increases at the same rate; some seniors in specific areas may get more benefits than others. Your actual benefit amount may vary based on your lifetime earnings record and the date you initially applied for Social Security. However, it appears that not all beneficiaries will receive the same average payouts, as certain states’ payment amounts will be higher.
Because of the way Social Security is calculated, some retirees in specific states may receive more than others. Your actual benefit amount may vary depending on when you start collecting Social Security and how much you earn over your lifetime.
According to a recent Motley Fool study, these attributes might result in higher Social Security payouts in some states than others. This is because, depending on the COLA, some states’ median incomes are much higher than others, resulting in higher Social Security payments. According to the Motley Fool, the following states have the highest median monthly Social Security checks:
- New Jersey: $2,100
- Connecticut: $2,084
- Delaware: $2,064
- New Hampshire: $2,039
- Maryland: $2,008
- Michigan: $2,005
- Washington: $1,992
- Minnesota: $1,982
- Indiana: $1,952
- Massachusetts: $1,946
Why Will Some Beneficiaries Receive Greater Social Security Payouts in These States?
According to Alex Beene, a financial literacy professor at the University of Tennessee at Martin, Social Security gains are larger in various states because their median salaries exceed the national average. This is reflected in the benefits recipients get, and because their monthly payments are bigger, they are more likely to receive the largest COLA increases.
Furthermore, if current COLA projections are accurate, the median retiree in New Jersey will get an additional $54.60 in Social Security benefits. In Massachusetts, the price increase would be $50.60. On average, the states listed above had greater salaries, with New Jersey, New Hampshire, Maryland, Washington, and Massachusetts ranking among the top 10.
However, the whole narrative extends beyond income to explain why these areas will benefit the most from larger cost-of-living adjustment increases. Even among retirees with more disposable cash, some prefer to stay in their retirement communities.
For example, the Motley Fool points out that Washington, D.C., and California have among of the highest average Social Security payments but the lowest incomes because retirees are going elsewhere. Finally, retirees who live outside of the top ten states can expect a big rise in their benefits because the cost-of-living adjustment is applied to their monthly checks regardless of location.
Social Security Payout Amounts for Beneficiaries Assuming a 2.6% Cola in 2025
If the 2.6% COLA increase were to take effect in January 2025, the following payment amounts would be available to beneficiaries based on the federal programs for which they qualify:
| Retirement benefits (plus 2.6%) | Survivor benefits (plus 2.6%) | SSDI benefits (plus 2.6%) | SSI benefits (plus 2.6%) |
| On average: $1,949
Age 62: $2,780 Age 67: $3,921 Age 70: $5,000 |
On average: $1,544
Individual: $1,819 2 Children: $3,748 |
On average: $1,577
Blind recipients: $2,657 Maximum payment: $3,921 |
On average: $716
Individuals: $968 Couples: $1,452
Essential person: $484 |