The Highs and Lows of Social Security COLAs
The Social Security cost-of-living-adjustment (COLA) was created to help seniors and others receiving Social Security benefits keep up with inflation. The first one was in 1975 but according to 24/7 Wall Street, while there is supposed to be an annual increase yearly, there have been at least three years without one: 2009, 2010, and 2015.
The highest COLA on record was in 1980. Driven by stagflation and the energy crisis, recipients saw a record-breaking 14.3 percent COLA increase to help offset double-digit inflation. Post-pandemic high inflation was the cause behind 2023’s 8.7 percent COLA, which is one of the highest on record.
2025 COLA
This year, Social Security recipients received a modest 2.5 percent COLA increase, reflecting efforts to bring inflation under control. That’s down from 2022’s 3.4 percent COLA. In 2025, Social Security recipients are getting an extra $48 per pay period on average — with the average benefit check being about $1,968 monthly.
New COLA Calculator
While any increase is certainly appreciated, seniors are still struggling to keep up with the high costs of basic necessities. A new COLA calculator would help. Currently, the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) is used. That does a disservice to older Americans.
Senior advocates such as The Seniors Trust believe the Consumer Price Index for Americans 62 years of age and older (CPI-E) would be a better formula, as it more accurately reflects the costs incurred by older adults, especially related to healthcare and housing.
The Social Security Expansion Act calls for adopting the CPI-E. Not only would this provide Social Security recipients with a fairer COLA, but this landmark piece of legislation also provides across-the-board benefits boost of about $2,400 per year and long-term Social Security solvency.
