As inflation cools, the 2025 Social Security cost-of-living adjustment (COLA) is expected to drop to 2.5%, down from 2024’s 3.2% increase. This decrease, estimated based on the latest Consumer Price Index data, would raise the average monthly benefit of $1,870 by approximately $46.80, but experts warn it may not be enough to help seniors cope with rising costs of essentials like housing, auto insurance, and healthcare.
Social Security policy analysts note that despite the COLA, many seniors continue to fall into poverty. Census Bureau data shows a growing number of seniors in poverty since 2020, with 14.2% living below the poverty line in 2023, the highest percentage since 2016.
Additionally, rising Medicare Part B premiums, projected to increase by 5.9% in 2025, further erode Social Security gains, leaving retirees increasingly vulnerable to financial strain. The official COLA for 2025 will be announced in October.
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