But a 2.5% COLA for 2025 stings because it's the smallest one to arrive in years. At the start of 2024, seniors on Social Security saw their benefits increase by 3.2%. And the year prior, Social Security recipients got a record-breaking 8.7% COLA. So a raise of just 2.5% seems awfully meager by comparison.

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.

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

The reason Social Security benefits are eligible for an automatic cost-of-living adjustment (COLA) each year is that without an inflation-based boost, seniors would be guaranteed to lose buying power from one year to the next.

A Social Security cost of living increase offers retirees options such as managing costs, saving or enjoying small splurges.

Social Security is by far one of the most popular government programs in the United States because it is critical for so many retirees' financial security.