Over 72.79 million Americans received some form of Social Security benefit in October, where the average monthly benefit stood at $1,787.08. The Social Security program serves as a crucial source of income for more than 54.15 million retirees across the country. While Social Security is designed to support retirement income levels, beneficiaries increasingly rely on these checks to run their households. The Social Security Administration estimated that monthly Social Security checks for 65 or older represent 30% of their income.
Moreover, Social Security checks represent 50% of the monthly income for 42% of women collecting benefits and 90% of income for 12% of men. Although the maximum monthly benefit for retirees claiming Social Security at full retirement age is north of $4,000 for 2025, the low monthly average could be attributed to early retirements due to financial or health-related challenges.
Social Security COLA For 2025 Increases By 2.5%, Benefits Vary For Each Recipient
Given the importance of Social Security income, it becomes essential for retirees to be aware of the complex rules around eligibility, changes in annual benefits, and specific dates, as your birthday determines when you receive checks every month. Furthermore, the annual cost-of-living adjustments (COLA) are released in October every year after considering inflation levels in the preceding quarters. For 2025, the SSA is hiking Social Security checks by 2.5%, translating to an almost $50 jump in average monthly income for all retirees to $1,976, or $23,712 annually. The latest COLA, effective January 2025, is the lowest in years: 3.2% for 2024 and 8.7% for 2023.
The annual COLA hikes help beneficiaries overcome inflationary pressures and retain purchasing power. Although inflation reached record levels since last year, it has been cooling down consistently in the past few quarters, closing in on the US Federal Reserve's 2% target, making the 2025 COLA more manageable for retirees. However, the Social Security benefits will vary for retirees depending on several factors, such as the age at which they claim, duration of their service, and earnings during their working years.
Creating a my Social Security Account For Better Financial Planning
Given the importance of Social Security benefits, as many rely heavily on them to sustain every month, recipients can open a my Social Security Account by November 20 to view the latest COLA notices detailing the exact amount they will receive starting next year. The free account offers valuable tools and features to address concerns or updates related to the program. It can help retirees estimate future benefits, request a Social Security replacement card, check application statuses, and even manage their existing benefits, all in one place.
Account holders can also change addresses, print benefit verification letters, receive Social Security statements, and request SSA-1099 tax forms through the online portal. You also have the option to receive email or text alerts for notices sent by the SSA from time to time. Many retirees prefer to receive Social Security notices offline. However, they needn't worry; the SSA will mail physical COLA notices through December. Overall, the my Social Security Account detailing all earnings reports and estimates can help retirees plan their budget in advance as they will have access to benefit details immediately upon signing up.
