If you receive Social Security Disability Insurance (SSDI) benefits, good news is on the way: your monthly payments are set to increase in January 2025. The Social Security Administration (SSA) has announced a 2.5% Cost-of-Living Adjustment (COLA) for SSDI recipients. Although the increase may feel modest, it still provides some welcome financial relief, especially for those on tight budgets.
Here’s everything you need to know about how much your SSDI payments will increase and what it means for your finances.
COLA
The 2.5% COLA adjustment aims to help SSDI beneficiaries keep pace with rising living costs caused by inflation. This adjustment, which applies to both SSDI and Supplemental Security Income (SSI) recipients, is crucial in maintaining purchasing power, even if the increase doesn’t fully match the soaring prices of essential goods and services.
Although the COLA adjustment was announced in October 2024, the new payment amounts will only take effect starting January 2025.
Payment Increases
The average SSDI payment in 2024 is $1,539 per month, and with the 2.5% increase, that amount will rise to about $1,577 in 2025. On average, SSDI recipients will receive an extra $38 per month—a helpful increase, especially for those managing expenses on a limited budget.
Here’s how different benefit amounts will change with the COLA increase:
| Current SSDI Payment | New Payment After 2.5% COLA | Monthly Increase |
|---|---|---|
| $600 | $615 | $15 |
| $800 | $820 | $20 |
| $1,000 | $1,025 | $25 |
| $2,000 | $2,050 | $50 |
| $3,000 | $3,075 | $75 |
As you can see, the larger the monthly benefit, the bigger the increase. This adjustment will add $300 annually for someone receiving $1,000 per month, which could help cover essentials like groceries or utility bills.
Dual Eligibility
Some SSDI recipients with low income may also qualify for Supplemental Security Income (SSI). If you’re eligible for both, you’ll benefit from COLA increases in both payments. However, because SSI payments are generally smaller, the dollar increase will be lower, even though the 2.5% COLA adjustment applies equally.
For example, SSI recipients can expect up to $23 more per month with the 2025 COLA increase. While this might seem small, every bit helps for those managing on limited funds.
The 2025 COLA increase brings a 2.5% boost to SSDI and SSI payments, offering some financial relief to recipients. While the extra funds may not cover all inflation-related expenses, they provide much-needed support, especially for those on fixed incomes. If you receive SSDI, be sure to plan for your adjusted payments starting January 2025, and if you are eligible for both SSDI and SSI, you’ll see increases in both benefits.
Even small increases, like $25 a month, can make a difference over time—helping with groceries, transportation, or other essential needs. Staying informed about these adjustments ensures you can make the most of your benefits.
FAQs
When will SSDI recipients see the 2025 COLA increase?
The new payments will take effect January 2025.
How much is the 2025 COLA increase for SSDI?
SSDI payments will increase by 2.5%.
How much will someone with $1,000 in SSDI receive after the COLA?
They will receive $1,025 per month in 2025.
Can SSDI recipients also receive SSI payments?
Yes, those with low income may qualify for both SSDI and SSI.
How much will SSI payments increase in 2025?
SSI payments will rise by 2.5%, with increases up to $23 per month.
