If you have been following your Social Security benefits closely, you may be filled with questions. As costs continue to increase and the economy evolves, it is crucial to remain informed about any changes that may affect your financial situation.
Fortunately, Social Security has made some changes that may influence the amount of your monthly payments in 2024. In this article, we’ll explain what these changes are and what they could mean for you.
Expected Changes in 2024
Social Security recipients will have reason to cheer in 2024 as the monthly payments are going to increase significantly. This change is called the Cost-of-Living Adjustment or COLA. It is intended to help beneficiaries cope with inflation and retain their purchasing power. In 2024 COLA is expected to be approximately 3.1%. However, this is not as steep as the exponential growth observed in the past. But, it is still a decent rise that will go a long way in cushioning some of the effects of inflation.
The COLA is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This is a measure of the average change in prices of goods and services. This information is then employed by the SSA to make adjustments to the benefits, every year. The whole purpose of doing this is to keep in touch with the existing economy. Up to this time, the anticipated 3.1% rise for 2024 is planned to help address rising inflation worries to some extent.
As for COLA in 2025, the predictions are rather uncertain. The adjustment will be based on the economic condition and inflation expected to happen in the next year. In case inflation rate remains high or even rises, the COLA for the year 2025 might be even greater. But if inflation rate is constant or declining, the adjustment might be less. This is why it is important to keep on checking the economic trends to know how future COLA changes may affect your benefits.
Who Are Entitled to These Changes
So, who will benefit from these changes? The COLA adjustments apply to several groups, including:
- Retirees: Social Security retirement benefits recipients are expected to receive higher payments in their monthly checks due to the 2024 COLA adjustment.
- Disabled Workers: People who are in the Social Security Disability Insurance (SSDI) rolls will also feel the impact of the COLA adjustment. This adjustment is made in order to make sure that their benefits are in line with the current inflation rates.
- Survivors: Social Security survivor benefits will also be subject to the same changes. This includes the widows, the widowers and the dependent children who are eligible to receive survivor benefits.
- Supplemental Security Income (SSI) Recipients: SSI beneficiaries, who are entitled to monetary support for the aged, blind, or disabled, will also feel the impact of the COLA adjustment.
However, it is important to realize that the COLA may not fully cover all the costs of living expenses. Everyone has his or her financial circumstances, so it is always advisable to check your financial status before planning.
The future changes in Social Security benefits in 2024 will help increase your monthly payouts through a 3.1% Cost-of-Living Adjustment. While this increase is aimed at addressing inflation and increasing costs, it is crucial to understand how future COLA adjustments may impact you. Knowing these changes can assist you in managing your resources and being ready for any change in the economy.
Follow the news from the Social Security Administration and be active in your financial planning. This way, you can understand these changes and be in a better position to face what is coming in the future.
