“3.2% Increase: Social Security Recipients Receive Cost-of-Living Boost in 2024

Good news for Social Security recipients – a 3.2% Cost-of-Living Adjustment (COLA) has been announced for the year 2024! This increase in benefits applies to more than 12 million beneficiaries and is the largest increase in six years. For more than 80 years, Social Security benefits have been adjusted annually to keep up with the rising cost of living as measured by the Consumer Price Index (CPI). The year of 2024 will mark the 12th time that the Social Security Administration (SSA) has given benefits recipients a COLA increase. The SSA sends out annual reports that detail the amount of the adjustment. Unfortunately, the 3.2% increase for 2024 is lower than expected. Last year, the SSA estimated the adjustment for 2024 would be 3.7%. The cause for the lower than expected COLA is the fall in gasoline prices in 2020, and the resulting drop in CPI. However, the decrease in the COLA does not mean Social Security recipients will be worse off in 2024! The 2020 COLA was 1.3%, which was the smallest in 40 years; this makes the 3.2% COLA for 2024 actually an improvement on 2020. In fact, the COLA increase for this year was 1.6%. The SSA also encourages recipients to maximize their benefits using their Retirement Estimator or by talking to an SSA representative. They give tips on how to optimize one’s benefits, such as taking full advantage of spousal benefits. Social Security recipients can set their minds at ease knowing that their benefit levels will remain stable and that they will not face a decrease in benefits during the year 2024. The 3.2% COLA increase is welcome news and will help ensure that recipients can keep up with the rising cost of living.