As the year nears its end, it’s important for Social Security retirees to stay aware of crucial dates and updates that could affect their benefits. One such important date is November 20, 2024. Understanding what needs to be done before this date is essential for managing your Social Security benefits in 2025. This article highlights key details about the 2.5% Cost-of-Living Adjustment (COLA) and how you can prepare for the upcoming changes.
Understanding the 2025 Cost-of-Living Adjustment (COLA)
In October 2024, the Social Security Administration (SSA) announced a 2.5% COLA for 2025. This increase, though smaller than previous years, is designed to help retirees keep up with inflation and rising costs. Starting in January 2025, the average monthly benefit will rise from $1,921 to $1,969, bringing the annual benefit total to $23,628.
Important Dates to Remember
| Date | Action Required | Purpose |
|---|---|---|
| October 2024 | SSA announces 2025 COLA | Inform retirees of benefit increases |
| November 20, 2024 | Deadline to create my Social Security account | Access your personalized COLA notice |
| Early December 2024 | COLA notices available online | View your benefit updates early |
| December 2024 | Physical COLA notices mailed | Receive your benefit adjustments by mail |
| January 2025 | Adjusted benefits disbursed | Receive updated monthly payments |
Why November 20 Matters
To access your personalized COLA notice, retirees must have a my Social Security account by November 20, 2024. This online account will give you access to your benefit details, including the COLA adjustment, in early December. Setting up your account before this deadline will ensure you can view your COLA notice online and plan accordingly.
Benefits of a my Social Security Account
Creating a my Social Security account offers many advantages:
- Immediate Access to COLA Notices: View your benefit updates right when they’re released.
- Manage Benefits: Update personal details and manage your direct deposit information.
- Tax Documents: Access your SSA-1099 for tax filing.
- Replacement Cards: Request a new Social Security card if needed.
Alternative: Physical COLA Notices
If you prefer not to create an online account, the SSA will mail physical COLA notices throughout December 2024. However, having an online account allows for faster access to your benefit information, helping you plan your finances sooner.
Budgeting Tips for Retirees
With your benefit adjustments in hand, effective budgeting becomes even more important. Here are some tips:
- Calculate After-Tax Income: Understand how much you will actually take home after taxes.
- Forecast Expenses: Estimate your costs for housing, food, and transportation.
- Save for Unexpected Expenses: Set aside funds for emergencies.
- Monitor Spending: Review your expenses regularly to identify areas to save.
FAQ’s
What is the 2025 COLA increase?
The 2025 COLA is a 2.5% adjustment to Social Security benefits, raising the average monthly benefit from $1,921 to $1,969.
How can I access my COLA notice?
Create a my Social Security account by November 20, 2024 to access your COLA notice online.
What happens if I don’t create an online account?
If you don’t create an online account, the SSA will send your COLA notice by mail in December 2024.