Securing Your Future: Understanding Social Security COLA And Financial Trends💰

Even if you are not within retirement age, you need to be thinking long term and looking at trends financially that could effect your future down the road. It's good advice to younger generations to at least take a look at financial data for later in life so you are not caught by surprise and caught without a good start towards financial security for you and your family.

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What is the Social Security Cost-of-Living Index?

According to the Social Security Administration, "Since 1975, Social Security's general benefit increases have been based on increases in the cost of living, as measured by the Consumer Price Index. We call such increases Cost-of-Living Adjustments, or COLAs. We determined a 3.2-percent COLA on October 12, 2023." The COLA is an increase in Social Security Payments to offset inflation. Higher inflation the higher the COLA, the lower the inflation is, the lower your COLA will be. So you may see less in your check by 2025, but predictions are the rate of inflation will be. Experts do say that this is not set in stone and things can always change on the financial scene.

What Is The Cost of Living Outlook For 2025?

According to a CNBC article, the COLA for 2025, at this time, seems to be coming down. The COLA for 2024 was 3.2% and current projections for 2025 will be 2.4%. So in theory you will see less in your Social Security checks, but inflation will be lower. So don't expect to possibly see the same payment in your account next year.

So experts say keep an eye on the financial situation not only here in New Jersey, but for the nation as a whole. Here are some key takeaways from Investopedia:

KEY TAKEAWAYS

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ALWAYS CONSULT YOUR FINANCIAL EXPERT FOR ANY FINANCIAL QUESTIONS OR MATTERS