Social Security benefits are rising by $56 per month in 2025 for the average retired worker

In January 2025, the average retired worker receiving Social Security will see their monthly payment increase by $56. This increase comes from an annual adjustment called the Cost of Living Adjustment (COLA), which the Social Security Administration calculates each year based on inflation. The 2025 COLA is 2.7 percent — lower than the previous two years, but still a meaningful bump for people living on fixed retirement income.

If you received an average benefit of about $1,907 per month in 2024, your 2025 payment will be approximately $1,963. The exact amount you receive depends on your own work history and when you started taking benefits, so your increase may be higher or lower than $56. Most people see the new amount reflected automatically in their January payment with no action needed on their part.

Key Takeaways

  • The average retired worker's benefit rises by $56 monthly in 2025 due to a 2.7 percent Cost of Living Adjustment.
  • Your personal increase depends on your own benefit amount, not on the national average.
  • The adjustment happens automatically each January; you do not need to contact Social Security to receive it.
  • COLA protects retirees from losing purchasing power as prices for food, housing, and healthcare rise.

How the Cost of Living Adjustment is calculated

The Social Security Administration measures inflation using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a tool that tracks price changes for everyday items like groceries, rent, utilities, and medical care. Each October, the SSA compares the average CPI-W for July, August, and September of the current year to the same three months from the previous year. If prices have risen, benefits go up by that percentage.

The 2.7 percent increase for 2025 reflects the inflation that occurred between mid-2023 and mid-2024. This was lower than the 8.7 percent increase in 2023 and the 3.2 percent increase in 2024, meaning inflation has slowed compared to the previous two years. However, it is still higher than the long-term average COLA, which hovers around 2 to 3 percent.

Congress does not vote on COLA each year — it is a built-in mechanism designed to prevent retirees' purchasing power from shrinking as the cost of living rises. This automatic adjustment has been part of Social Security since 1975.

Who receives the 2025 benefit increase

The $56 average increase applies to retired workers who are already receiving Social Security. It also applies to their spouses, children, and survivors who receive benefits based on the retired worker's record. If you are receiving Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI), you also receive a COLA adjustment, though your increase may differ because your benefit amount is different.

The increase is automatic — you will see it in your January 2025 payment if you receive benefits by direct deposit or check. If you have not yet started taking Social Security, the COLA does not affect you yet. When you do start, your benefit will be calculated based on your earnings record and the age at which you claim, not on the previous year's COLA.

What $56 more per month actually covers

A $56 monthly increase sounds modest, and for many retirees it is. That works out to about $1.87 per day. For someone on a tight budget, it might cover a few extra groceries or part of a utility bill increase. For others, it barely keeps pace with how much their own costs have risen since last year.

The purpose of COLA is not to improve your standard of living — it is to prevent it from declining. If inflation has pushed up the price of your medications, food, or rent by more than 2.7 percent, your benefit increase will not fully cover that gap. If inflation in your area has been lower than the national average, the increase may be more than you need. COLA is a one-size-fits-all tool designed to protect the average retiree, not to match each person's individual expenses.

How your personal benefit increase compares to the average

The $56 figure is the average increase across all retired workers. Your own increase depends entirely on your current benefit amount. If you receive $1,500 per month, your 2.7 percent increase is about $40. If you receive $2,500 per month, your increase is about $68. The percentage is the same for everyone — 2.7 percent — but the dollar amount varies.

Your benefit amount itself was set based on your highest 35 years of earnings and the age at which you claimed. Someone who worked longer or earned more receives a higher benefit and therefore a larger COLA increase. Someone who claimed at 62 receives a smaller benefit and a smaller increase. This means higher-earning retirees see larger dollar increases each year, even though the percentage is identical.

What happens if you have not started Social Security yet

If you are still working or have delayed claiming Social Security, the 2025 COLA does not directly affect you. However, it does affect the benefit amount you will receive when you do claim. Social Security calculates your benefit based on your earnings record at the time you claim, and that calculation includes all past COLAs. Delaying your claim means your benefit will be higher partly because of the COLAs that occurred while you waited.

The decision of when to claim — at 62, at your full retirement age (which ranges from 66 to 67 depending on your birth year), or at 70 — is separate from COLA. Claiming earlier means a smaller monthly benefit that receives smaller annual increases. Claiming later means a larger monthly benefit that receives larger annual increases. The COLA percentage is the same regardless of when you claim.

Frequently Asked Questions

Do I have to do anything to get the $56 increase?

No. The increase happens automatically in January. If you receive benefits by direct deposit, the new amount will appear in your account. If you receive a check, it will reflect the new amount. You do not need to contact Social Security or take any action.

What if I think my benefit amount is wrong?

You can check your benefit statement on the Social Security website or call 1-800-772-1213. If you believe there is an error in how your COLA was applied, Social Security can review your record. Keep in mind that the increase is always applied as a percentage of your current benefit, so the math is straightforward to verify.

Does the COLA increase affect Medicare premiums?

Medicare Part B and Part D premiums are set annually and may increase or decrease. However, there is a rule called "hold harmless" that prevents your Social Security benefit from decreasing if Medicare premiums rise. If your COLA increase is smaller than a premium increase, your benefit stays the same rather than going down. This protects most beneficiaries, though some higher-income retirees are not covered by this rule.

Will there be another increase in 2026?

Yes. Social Security receives a COLA adjustment every January as long as inflation has occurred. The 2026 increase will be announced in October 2025 and will be based on inflation data from summer 2025. There is no way to predict it now, but COLA has occurred every year since 1975.