Millions of Americans relying on Social Security benefits will continue to receive slightly higher monthly payments in August 2025 as a result of the cost-of-living adjustment (COLA) implemented earlier this year.
The increase, while not as large as previous years’ increases, reflects ongoing efforts to keep up with inflation and rising living costs.
The Social Security Administration (SSA) confirmed that a 3.2% COLA went into effect in January 2025, affecting benefits all year.
This means that recipients continue to benefit from the increase in their August 2025 deposits. According to the SSA, this change was made “to help Social Security and Supplemental Security Income (SSI) benefits keep pace with inflation.”
This increase was calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of 2023, which is a standard method for determining the COLA each year.
Though the 3.2% increase is significantly lower than the 8.7% increase in 2023, which is the largest in four decades, it still provides much-needed relief to retirees and other beneficiaries facing ongoing cost increases in housing, healthcare, and daily expenses.
What you can expect in your August 2025 deposit
As a result of the 3.2% COLA, the average Social Security retirement benefit increased by more than $50 per month beginning January 2025.
According to the Social Security Administration, the average retired worker’s benefit increased from $1,848 to $1,907. Those changes are still reflected in the monthly checks due in August.
This monthly boost is not limited to retired workers. Disabled people, survivors, and SSI recipients have all seen proportional increases in their benefits. The SSA website confirms that Social Security and SSI benefits will increase by 3.2% in 2025.
Medicare premiums were also adjusted, along with Social Security payments. The standard monthly premium for Medicare Part B increased by $9.80, reaching $174.70 in 2025.
This higher premium may offset some of the COLA gains for those whose Medicare premiums are deducted directly from their Social Security benefits.
According to Axios, these deductions may prevent some individuals from seeing the full 3.2% increase reflected in their deposits. However, most recipients will see an increase in their monthly income, providing some breathing room.
Looking ahead, experts are already watching inflation trends to predict the 2026 COLA. While it’s too early to estimate the next adjustment accurately, the SSA will announce the 2026 COLA in October based on inflation data collected from July through September 2025.
For now, beneficiaries can expect their August 2025 payments to remain elevated thanks to the COLA applied at the beginning of the year, a welcome, if modest, increase for those living on fixed incomes.
