Social Security Checks will increase in 2025
Living costs have increased in 2025, and the amount people receive will change during Social Security Checks.
Fox-10 Phoenix
Estimates from independent analysts show that it could increase by 2.4% next year, based on Tuesday’s Consumer Inflation Report.
According to the Labor Bureau’s Consumer Price Index, overall consumer prices rose 2.3% from the previous month, a measure of average changes in goods and services costs, up 2.4% from the previous month, and the lowest annual increase since February 2021. The so-called CPI-W subset of consumer price reports used to determine the increase in social security’s cost of living increased by 2.1% from a 2.2% increase in March.
Official 2026 Coke will not be determined until October as it relies on third quarter inflation data collected between July and September. However, analysts often track estimates in the months leading up to the important July-September time frame.
Coke at 2.4% is the smallest increase since 2020, with average retirement benefits rising to around $48 in April at $1,999.97 a month. In January, the average beneficiary received an increase of 2.5%. This was a $50 salary increase from $1,907 in January 2024 to $1,957.
The estimated 2.4% COLA increase is higher than last month’s 2.2% forecast, but it could underestimate the final 2026 cola, says Mary Johnson, Independent Social Security and Medicare policy analyst.
“Trump administration tariffs are just beginning to impact consumer prices,” she said.
How could Trump’s tariffs affect Coke?
While some of the highest in President Donald Trump’s tariffs have now fallen or suspended, economists believe that those on the spot are enough to quickly increase inflation.
“The escalation with China provided short-term relief, but the reality that inflation is likely to peak at 3% later this year remains a significant uncertainty about what US trade policy will look like over the next 90 days.”
On Monday, China and the US said they would suspend mutual tariffs for 90 days. The US, which is effective from Wednesday, will temporarily reduce China’s tariffs from 145% to 30%, while China will reduce US tariffs from 125% to 10%.
Coke should rise along with increased inflation.
What is CPI-W?
The Social Security Administration plantes an average annual increase in the consumer price index for urban wage workers and administrative workers (CPI-W) from July to September.
CPI-W is a subset of the overall consumer inflation index that examines price inflation experienced by adults under the age of 62, Johnson said. The problem with that is that younger workers spend different money than older people eligible for Medicare. For example, economists estimate that younger workers spend around 7% of their budget on healthcare, but research and surveys show that older people tend to spend an average of 15% or more on healthcare.
As a result, cola often seems inadequate to keep up with rising costs, Johnson said.
However, this year, Johnson noted that prescription drug prices have not grown as fast as in the past few years. Prices for prescription drugs rose 2.3% from one year ago to April, as measured by the Bureau of Labor Statistics. In 2023, prescription drug prices increased by 3.3% from December 20th to December 20th, 202223 before slowing down last year.
Since 2023, the Inflation Reduction Act requires pharmaceutical companies to pay a Medicare rebate if drug prices rise faster than inflation. “That provision, widely supported by Medicare beneficiaries, could be curbing runaway drug prices,” she said.
Can Trump keep prescription drug prices even lower?
Trump signed an executive order on Monday, encouraging governments to negotiate costs for prescription drugs that have been paid in other countries, and to what tend to be much lower.
The proposal has been widely supported by older Americans, but it is unclear whether Trump’s order will cut costs, Johnson said.
“But the executive order is not the same as a change in the law that empowers Medicare to use these prices in negotiations with pharmaceutical companies,” Johnson noted. The court also blocked similar plans during Trump’s first presidency.
Instead, the executive order appears to use pricing in the most preferred countries to promote consumer sales. The executive order also mentions exemptions that allow prescriptions to be imported from other countries where prices may be low.
“If it doesn’t muddier the water enough, you need to wonder how tariffs will affect the final drug price,” she said.
Medora Lee is a money, market and personal finance reporter for USA Today. mjlee@usatoday.com and Subscribe to our free daily money newsletter Personal finance tips and business news every Monday to Friday.
