Increased Social Security payments: What will they be like in 2024 and how much will I collect?
Social Security payments change each year due to the cost of living adjustment. Find out how much they will increase in 2024 and how much you could collect.
Each year, Social Security benefits are increased thanks to the cost-of-living adjustment, which is intended to help beneficiaries cope with changes in purchasing power. This COLA is not a fixed amount, so the increase varies from year to year.
Beginning in 1975, Social Security began these automatic annual cost-of-living allowances. The COLA is linked to the annual increase in the Consumer Price Index for Salaried Workers in Urban Areas and Clerical Workers (CPI-W).
The COLA calculation covers the third quarter of the previous year to the third quarter of the current year. For example, the difference between the CPI-W of 2021 and 2022 was 8.7%, so Social Security payments increased by that percentage in 2023. By how much will they increase by 2024?
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Increased Social Security payments: What will they be like in 2024 and how much will I collect?
Being related to the increase in the CPI-W, the COLA varies each year. The increase for 2023 was higher due to high levels of inflation. However, since this economic indicator has fallen considerably, a smaller increase is expected for next year.
According to the most recent estimate from The Senior Citizens League, one of the nation’s largest nonpartisan senior groups, the Social Security cost-of-living adjustment for 2024 could be 3%. This estimate was calculated based on June Consumer Price Index data. In June, the prediction for 2024 was a COLA of 2.7%.
Social Security: How much could you collect in 2024?
Considering that the average monthly amount of Social Security checks is $1,827 this year according to an SSA update in January, with a 3% increase, that would be about $1,881 by 2024. To get an estimate of your benefits in 2024, you can add 3% to your current monthly payment.
However, it is important to note that this is only an estimate, as SSA calculates payments on an individual basis each year by following a formula to determine your Primary Insurance Amount and then the amount to send to each beneficiary.
The most recent estimate of 3% for COLA 2024 is only preliminary and is subject to change. The official COLA for 2024 will be announced in October of this year, taking effect in December and being applied for the first time on payments in January of next year.