The latest estimate for Social Security’s cost-of-living adjustment for 2025 jumped to 2.4% due to sharper gains in inflation last month, according to The Senior Citizens League (TSCL), a nonprofit advocacy group.
In January, the 2025 COLA estimate was 1.75%.
The consumer price index (CPI), a broad measure of goods and services costs, rose 3.2% in February from a year earlier, according to government data reported on Tuesday.
The so-called core rate, which strips out volatile food and energy prices, rose 3.8% on the year.
The subset consumer price index for urban wage earners and clerical workers, or CPI-W, that COLA is based on, rose two-tenths from January to 3.1%.
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All the items older adults spend most of their money on continued to rise, said Mary Johnson, TSCL policy analyst. “Shelter, medical, and transportation prices remain higher than overall inflation rate,” she said.
Shelter jumped 5.7% year-over-year while medical care services edged up 1.1%, data from the Bureau of Labor Statistics showed. Hospital care increased 6.1% and transportation services soared 9.9%.
How is COLA calculated?
The Social Security Administration bases its COLA each year on average annual increases in the consumer price index for urban wage earners and clerical workers (CPI-W) from July through September.
The index for urban wage earners largely reflects the broad index the Labor Department releases each month, although it differs…
