Nearly 72.5 million Americans rely on Social Security. The vast majority — around 65 million — receive Social Security only, with the rest collecting SSI benefits or both Social Security and SSI. The program keeps millions of seniors and disabled people out of poverty, one monthly payment at a time.
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The Social Security Administration (SSA) calculates those payments based on the recipient’s earnings history and the age at which they claim their benefits. Because new beneficiaries enter the program every month as the deceased leave the rolls, the average payment changes from month to month — usually only slightly.
However, as you’ll soon see, some months witness dramatic fluctuations. No one knows for sure what the average payment will be this fall, but some telltale indicators can point you in the right direction.
3 Months of Wild Swings in Benefit Payments
Here’s a look at the average monthly payment for all individual beneficiaries, including Social Security and SSI, for the last three months starting in May. The SSA has not yet released its August statistical snapshot.
- May 2024: $1,917
- June 2024: $1,781.07
- July 2024: $2,507
According to The Hill, the average benefit dropped in June because a quirk in the SSA’s calendar schedule delayed that month’s payment for many beneficiaries until early July, which pushed July’s average up significantly but artificially.
These kinds of administrative variables and many others make it impossible to accurately predict any future average payment, but it is rare for the mean to vary so drastically from one month to the next.
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What Will the Average Payment Be in the Fall?
The SSA does not predict future average payments because not even the agency can guess what they’ll be. However, the significant fluctuations that dominated the late spring and summer were due to a relatively rare late-month calendar discrepancy that pushed one month’s payment into the next because the original payment date fell on a weekend.
That’s the exception to the rule, and payments in the fall months will likely revert to something closer to the three-month average of around $2,068.33.
If you’re already collecting benefits, keep in mind that the payment you received in January won’t change in the fall or anytime else in 2024 — but it almost certainly will change in 2025.
2025 COLA: Beneficiaries Should Expect a Modest Raise Next Year
Every year since the mid-1970s, the SSA has used Consumer Price Index data published by the Bureau of Labor Statistics to calculate its annual cost of living adjustments (COLAs), which — with a few rare exceptions — increases the following year’s Social Security payment to help beneficiaries keep up with inflation.
The 2022 COLA increased payments by 5.9%. In 2023, it soared to 8.7% — the biggest jump in 40 years — as inflation also raced to a four-decade high. This year it fell to 3.2% as inflation receded.
Recent economic reports have indicated that the inflation rate is still falling, dropping below 3% for the first time since the crisis of rising prices began and inching closer to the Fed’s longstanding target of 2%.
That is a double-edged sword for retirees on a fixed income. Since prices are rising by less, many will be able to stretch their benefits further — but they’ll also have to brace for a smaller COLA in 2025. The SSA won’t release its final calculation until later in the year, but in August, the Senior Citizens League tempered its 2.63% July projection to a likely 2.57% COLA for 2025.
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This article originally appeared on GOBankingRates.com: Here’s What the Average Social Security Payment May Be in Fall 2024
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