If you’re retired and living in San Diego, changes to your Social Security benefits can feel like a big deal—especially when it comes to keeping up with the cost of living. The 2025 Cost-of-Living Adjustment (COLA) brings a 2.5% increase to Social Security benefits, helping ease some of the pressure from rising prices. While this may not seem like a huge jump, it’s designed to help your income stretch a little further as everyday costs change. Here’s what this means for you and how to make the most of it.
What is COLA?
COLA stands for Cost-of-Living Adjustment, and it’s a yearly increase in Social Security benefits aimed at helping retirees keep up with inflation. Basically, it’s a way to make sure that as things get more expensive—whether it’s groceries, healthcare, or housing—your benefits increase to help cover those costs.
For 2025, the COLA increase is 2.5%. While that’s a bit lower than last year’s 3.2%, it’s still in line with what we’ve seen over the past decade, which averages out to about 2.6%. It reflects a slowing of inflation, which is a sign that prices aren’t rising quite as quickly anymore.
How the 2025 COLA Affects Your Social Security
Starting in January 2025, your Social Security check will reflect the 2.5% increase. What does that look like in real dollars? Let’s say you currently receive $1,500 a month. With the COLA adjustment, you’ll get an extra $37.50, making your new monthly total $1,537.50. It might not seem like a huge change, but over the year, that adds up to about $450 more in your pocket—enough to help with rising costs for necessities.
Tips to Make the Most of the COLA Increase
Even though the 2.5% bump can help with some of your expenses, it’s always good to have a plan in place to stretch those dollars further. Here are a few tips to keep in mind:
- Check Your Budget: With rising costs for things like utilities, healthcare, and groceries, this is a great time to take a fresh look at your budget. The extra money from the COLA increase could help cover those areas where prices are going up the fastest.
- Find Ways to Save: Consider ways to boost your savings—even small changes can add up over time. Whether it’s cutting back on your everyday expenses or putting a little extra into your savings account, a few adjustments could make a big difference.
- Explore Local Resources: San Diego has great programs for seniors that can help stretch your budget even further. Look into senior discounts for public transportation, utilities, or even local events and services—every little bit helps.
Looking Ahead to 2025
The 2025 COLA increase is designed to help you keep up with rising costs, but it’s also a good reminder to think about your overall financial health. Whether you’re already receiving benefits or planning to retire soon, it’s important to make sure your savings and retirement plans are working for you.
At Mission Fed, we’re here to help you navigate your financial journey. Whether it’s retirement planning, managing your benefits, or finding ways to grow your savings, we’re committed to supporting you making sure you’re ready for what’s ahead.
The content provided in this blog consists of the opinions and ideas of the author alone and should be used for informational purposes only. Mission Fed Credit Union disclaims any liability for decisions you make based on the information provided. References to any specific commercial products, processes, or services, or the use of any trade, firm, or corporation name in this article by Mission Fed Credit Union is for the information and convenience of its readers and does not constitute endorsement, control, or warranty by Mission Fed Credit Union.
