Seniors Will Likely See Lowest COLA Since 2021

Inflation may be cooling, but so is the annual Social Security Cost of Living Allowance doled out to some 68 million American seniors. As NBC News reports, it looks like the 2025 COLA may be the most meager since 2021, even as older Americans still face rising costs. The official figure will be released by the Social Security Administration on Oct. 10. A look around:

• How much is meager? We're talking 2.5%, or a bump of about $46.80 per month. The Senior Citizens League advocacy group and the nonpartisan think tank Committee for a Responsible Federal Budget both show identical numbers. For context, the Wall Street Journal notes that would be the lowest COLA since 2021, when there was a 1.9% bump. The COLA rose to 5.9% in 2022, and jumped to 8.7% in 2023.

• How is COLA calculated? It's a projection based on Bureau of Labor Statistics reports. The bureau reported Wednesday that the Consumer Price Index rose 2.5% year over year. It reported a 2.6% jump in July.
• But other things are also going (and staying) up: Medicare Part B premiums, which are taken out of those Social Security checks, will rise by 5.9% in 2025. That's a $10.30 rise to $185 per month, and eats up about 20% of the likely COLA increase alone. In addition, seniors still face higher costs "on key essentials such as housing, meats, auto insurance, any type of service and repairs," says Mary Johnson, an independent Social Security analyst.

(More COLA stories.)