With a little more than a month before the 2025 COLA kicks in, here's what you should know about the upcoming adjustment.

Social Security's annual cost-of-living adjustments (COLAs) are calculated based on how inflation changes in the third quarter, the three-month period from July through September. In this scenario, inflation is measured using a subset of the Consumer Price Index (CPI) known as the CPI-W.

But when we look back at the data, it becomes clear that a 2.5% Social Security COLA isn't so terrible. In fact, it's a lot more generous than some of the COLAs beneficiaries have seen in the past. In 2024, Social Security benefits rose by 3.2%. The year prior, they increased by 8.7%. And in 2022, a 5.9% COLA came through.

Due to how the Social Security Administration schedules payments to beneficiaries, some will receive theirs with the 2025 COLA increase in December.

But the truth is that your monthly benefit is never truly locked in, because each year, Social Security recipients are eligible for an automatic cost-of-living adjustment (COLA).

Last month, the Social Security Administration revealed that benefits will receive a 2.5% COLA increase in 2025

A 2.5% cost-of-living adjustment increase will mean an extra $50 a month for most Social Security and SSI recipients.