The more than 71 million Americans who get Social Security benefits are set to see a bump in their monthly benefits as the 2024 cost-of-living adjustment goes into effect.
Officials announced in October that payments will go up by 3.2% — amounting to an average of more than $50 per month — beginning in 2024.
Here are some things to know:
Why are benefits increasing?
Social Security benefits have been automatically adjusted each year since 1975 as a way of ensuring that benefits keep up with inflation. The annual cost-of-living adjustment, or COLA, was passed by Congress in 1972. Before that, Social Security benefits only got a boost through special legislation.
How is COLA calculated?
By law, adjustments are tied to the annual increase in the Consumer Price Index for Urban Wage and Clerical Workers (CPI-W). The amounts are determined based on the CPI-W from the average for the third quarter of the current year to the average for the third quarter of the last year in which a COLA took effect, according to officials. If there is no increase, there is no COLA for that year.
The CPI-W, calculated each month by the Bureau of Labor Statistics, measures the average change in prices paid by consumers.
Why is the 2024 COLA 3.2%?
In the third quarter of 2023, the average CPI-W was 301.236. In the third quarter of 2022, the average was 291.901. The difference amounts to a 3.198% increase, which was rounded up to determine the COLA.
How does the COLA compare to prior years?
The benefits boost fell below increases seen in 2023 and 2022, though it is still larger than most figures seen in the last decade. According to officials, the increases in recent years have been:
- January 2024: 3.2%
- January 2023: 8.7%
- January 2022: 5.9%
- January 2021: 1.3%
- January 2020: 1.6%
- January 2019: 2.8%
- January 2018: 2.0%
- January 2017: 0.3%
- January 2016: 0.0%
- January 2015: 1.7%
- January 2014: 1.5%
When will people see the increase?
The COLA will go into effect with the December 2023 benefit, with payments going up in January 2024, according to officials. People who get Supplemental Security Income (SSI) benefits will see the increase in late December, as payments are typically made on the first of the month and Jan. 1 is a holiday.
Here are some dates to know:
- Dec. 29, 2023: The approximately 7.5 million Americans who get SSI benefits will see the effects of the COLA in their payments.
- Jan. 3, 2024: People who began getting Social Security benefits before May 1997 or who get both Social Security and SSI benefits will see their first increased payment.
- Jan. 10, 2024: Social Security recipients born between the first and the 10th of a given month will get their first increased payments.
- Jan. 17, 2024: People born between the 11th and the 20th of a month will get their first increased Social Security payments.
- Jan. 24, 2024: Social Security recipients born between the 21st and the 31st will get their first boosted payments.
