Last updated on November 25, 2019
For the more than 68 million people on Social Security and Supplemental Security Income, one of the most asked questions and most-watched announcements is this: Will Social Security get a raise? We have detailed the answer below on whether there will be a social security increase in 2020 or not.
This Post will Cover:
The Importance of Social Security Increases (COLA)
Will there be a Social Security increase in 2020?
Future Projections for Social Security Increases
The Importance of Social Security Increases (COLA)
In 1973, Congress passed legislation to make sure that Social Security and Supplemental Security Income (SSI) benefits keep pace with inflation. The Social Security cost-of-living adjustment (COLA) was launched.
The purpose of the COLA is to ensure that the purchasing power of Social Security and Supplemental Security Income (SSI) benefits is not weakened by yearly inflation.
How is a COLA calculated?
COLAs are based on increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). CPI-Ws are calculated on a monthly basis by the Bureau of Labor Statistics.
In order to calculate the following year’s COLA, the Social Security Administration uses the CPI-W from the third quarter of the last year a COLA was determined to the third quarter of the current year.
If there is no increase in the CPI-W number, then it means there can be no COLA increase for the following year.
Will Social Security get a Raise in 2020?
Your Social Security checks are projected to grow next year; however, the annual increase won’t be as much as you got in 2019.
From preliminary estimates provided by experts, it looks like Social Security benefits will increase by about 1.6% in 2020.
That is more than a full percentage point less than the 2.8% cost-of-living adjustment for 2019.
This number will be confirmed when the Social Security Administration makes a formal announcement on Oct. 10 after the release of the Consumer Price Index data (CPI-W) for September 2019.
Note that the number that will be provided by the SSA on October 10th may be higher or lower than the 1.6 that is being projected. We will update you on this once the announcement is made.
Update (November 2019): The Social Security Administration has confirmed that the Cost of Living Adjustment (also known as COLA) will see an increase of 1.6% in 2020.
The increase will begin with benefits that Social Security beneficiaries receive in January 2020. Increased SSI payments will begin on December 31, 2019.
Future Projections for Social Security COLA Increases
The table below shows estimated future cost-of-living adjustments (COLAs) provided by the SSA. These are based on the “intermediate” assumptions in the 2019 Trustees Report.
The COLA shown for a year is effective for December of that year but is payable in January of the following year.
| Calendar year | COLA (percent) |
|
|---|---|---|
| 2019 | 1.8 | |
| 2020 | 2.7 | |
| 2021 | 2.6 | |
| 2022 | 2.6 | |
| 2023 | 2.6 | |
| 2024 | 2.6 | |
| 2025 | 2.6 | |
| 2026 | 2.6 | |
| 2027 | 2.6 | |
| 2028 and later | 2.6 |
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