All Social Security Retirees Should Do This on Oct. 10
According to The Motley Fool, The most significant Social Security announcement of the year is just around the corner, set to be revealed on October 10. For retirees enrolled in Social Security, once you’ve signed up, there’s usually not much to do in relation to the federal program—unless you need to update your personal information due to changes in your address, bank account, or marital status. If you choose to withdraw your application to continue working, you can do so within a 12-month window.
Aside from these exceptions, retirees primarily need to be mindful of taxes owed on their benefits. However, many retirees don’t even have to worry about taxes if their income remains below the federal threshold and they reside in a state that doesn’t tax Social Security benefits.
What Should Retirees Do on October 10?
There is one essential action that all retirees should take on October 10, and it’s quite simple: go online. Specifically, visit the Social Security Administration (SSA) website’s Communications Corner.
As you scroll through the page, you’ll likely find multiple links to news releases. On the morning of October 10, 2024, a press release will be issued, disclosing the Social Security cost-of-living adjustment (COLA) information for 2025. This announcement will include the percentage increase in Social Security benefits effective January 2025, as well as the average dollar increase retirees can expect next year.
In previous announcements, the COLA press releases have also covered other important changes for the upcoming year, such as adjustments to the Social Security payroll tax maximum.
Why October 10 Matters
You might wonder why October 10 is the chosen date for this announcement. The reason lies in the release of inflation numbers from the Bureau of Labor Statistics (BLS) for September. While the BLS doesn’t announce these numbers on October 10 every year, it typically releases inflation data around the middle of each month.
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These inflation figures include the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which is the metric the Social Security Administration uses to calculate the annual COLA.
However, the calculation doesn’t rely solely on the September CPI-W. The SSA will compare the average CPI-W for the third quarter of 2024 against the average for the third quarter of 2023. The resulting percentage increase, rounded to the nearest tenth of 1%, will represent the official 2025 Social Security COLA.
Projected Social Security COLA for 2025
While you’ll have to wait a few more days for the exact figure, it’s possible to estimate the 2025 Social Security COLA based on available data. According to the Senior Citizens League, a nonprofit senior advocacy group, the projected COLA is around 2.5%. This would translate to an average monthly benefit increase of approximately $48 for retirees.
While a 2.5% increase is lower than the 3.2% COLA received in 2024 (and significantly less than the 8.7% increase from the previous year), it’s fairly close to the average benefits increase of about 2.6% over the past 20 years.
Be sure to check online on October 10 to discover how much your Social Security benefits will increase. Even if you forget to look, you won’t have to wait long; the SSA typically begins notifying individuals about their new benefit amounts by mail starting in December.
Unlocking Hidden Social Security Benefits
Many retirees overlook a significant opportunity for additional income from Social Security. If you find yourself behind on retirement savings, there are lesser-known strategies that could substantially enhance your retirement income. For example, one simple tactic could potentially earn you as much as $22,924 more each year.
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