Social Security: When will the 2024 COLA increases start and when will I receive them?
Every year the Social Security Administration announces a cost-of-living adjustment increase for monthly benefit payments, but when does it take effect?
It’s that time of year when the Social Security Administration (SSA) begins to calculate what the cost-of-living adjustment (COLA) increase will be for the next year. It will still be a number of weeks until when the COLA is officially announced and Social Security beneficiaries will have access to how much their monthly payments could be boosted.
That’s due to the way in which the automatic annual COLA is calculated. The SSA uses inflation data from the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) provided by the US Department of Labor. Not just any data though, but that from the third quarter of the year (July, August and September) prior to the COLA increase.
Last year, the SSA announced a historic COLA increase of 8.7 percent, that was due in large part to inflation peaking in June 2022 at a four-decade high. While inflation has cooled significantly in the United States, the increased cost of living is still affecting families, not least those receiving Social Security. But while the slowing of price rises is a good thing in general, it also augurs the reality that beneficiaries won’t see an increase anywhere near the 2023 COLA.
Social Security: When will the 2024 COLA increases start and when will I receive them?
The 2024 COLA will be announced once the CPI-W data for September 2023 is released, scheduled for 12 October. Current predictions from the Senior Citizen League, an non-partisan advocacy group for seniors, ticked up slightly in its latest report from 2.7 percent to 3 percent. According to the group’s calculations, that would mean almost $54 more per month based on an average monthly benefit of $1,789.
While the COLA increase will be announced in October, Social Security recipients won’t know the exact amount that their payments will increase until December when the agency mails notices to beneficiaries.
The boost to payments themselves will be sent with the first payments for the following year, those that correspond to January 2024. Recipients of Supplemental Security Income (SSI), a group that receives their payments on the first of each month, will receive the first increased monthly payments on Friday 29 December. This is because 1 January 2024 is a holiday as well as falling on a Monday, thus the payments are moved forward to the first applicable date that bank transactions can be processed.