Social Security recipients are in for some good news in 2025 with a 2.5% cost-of-living adjustment (COLA) announced by the Social Security Administration (SSA). This annual increase, designed to help keep pace with inflation, will benefit millions, including those receiving Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI). For many, this boost is a lifeline against rising living costs.
What’s Changing in 2025?
Starting in January 2025, millions of Americans on Social Security Disability will see a modest but important increase in their monthly benefits. The COLA increase of 2.5% translates to an average bump of about $50 per month for SSDI recipients. For those on SSI, the increase will take effect a little earlier, with boosted payments beginning on December 31, 2024.
While the 2.5% increase may seem smaller compared to previous years like 2023 (which saw an 8.7% jump), it’s still in line with the long-term average COLA, helping beneficiaries manage rising costs.
Other Key Changes for Disability Benefits
The boost to Social Security benefits isn’t the only change happening in 2025. There are also important updates to the program’s rules that will affect people with disabilities:
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Substantial Gainful Activity (SGA) Limit: For SSDI recipients, the monthly earnings limit will rise to $1,620 in 2025, up from $1,550 in 2024. This means you can earn more income without losing your disability benefits. For those who are blind, the threshold will increase to $2,700 from $2,590, providing even more flexibility.
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Earnings Cap for Social Security Taxes: The maximum amount of income subject to Social Security tax will also go up. In 2025, the cap will increase to $176,100, compared to $168,600 in 2024.
These adjustments make it easier for people to earn more without risking their benefits, and they help ensure that the Social Security program remains sustainable.
How Will You Be Affected?
If you’re a Social Security Disability beneficiary, you will receive a COLA notice detailing your new monthly benefit amount. This will arrive by mail in early December 2024, so keep an eye out for it. If you have an online “my Social Security” account, you can also access this information sooner by logging in to view your updated benefits.
The SSA has redesigned its notices to be more user-friendly, so you’ll easily be able to see how your benefits are changing and when you can expect to receive your new payments.
Why This Matters
With inflation continuing to affect daily expenses, this 2.5% COLA increase offers much-needed support. For SSDI and SSI recipients, it’s a step toward maintaining financial stability. While it’s important to recognize that the increase isn’t huge, it’s still a sign that Social Security benefits are being adjusted to meet the challenges of rising costs.
