Thousands of Mississippians, including nearly half a million retirees, will see an increase in their Social Security benefits this year.
On October 10th, the SSA announced a 2.5% increase in the cost of living adjustment for all beneficiaries for the following year. According to officials, starting in January, Social Security retirement benefits will increase by approximately $50 per month.
In an October announcement, Commissioner of Social Security Martin O’Malley stated that SSI payments and Social Security benefits would rise in 2025, assisting millions of people in meeting their expenses even as inflation has fallen.
Mississippi beneficiaries will receive an increase from the SSA in their Social Security benefits
COLA has increased by an average of 2.6% over the past ten years, peaking at 8.7% in 2023. The COLA for 2024 is 3.2%. The 2.5% increase will be paid to over 68 million Social Security recipients nationwide.
Yesterday, the Supplemental Security Income (SSI) program began sending additional benefits to approximately 7.5 million recipients. According to the federal agency, as of December 2023, over 469,500 Mississippi pensioners were receiving Social Security benefits.
These benefits were distributed to approximately 106,000 individuals, while disability compensation was distributed to 43,000 parents and widows, 14,000 spouses, and approximately 59,000 children.
Beneficiaries should be aware that Social Security retirement benefits start as early as age 62. Receiving Social Security benefits before reaching your “full” retirement age will result in reduced benefits.
The full retirement age has changed over time, with younger age groups experiencing an increase. For example, if beneficiaries chose to retire at the age of 66, they should have claimed benefits between 1943 and 1954.
The full benefit amount increases for people born in 1955 who claimed benefits at 66 years and 2 months, 1956 who claimed at 66 years and 6 months, 1957 who claimed at 66 years and 6 months, 1958 who claimed at 66 years and 8 months, 1959 who claimed at 66 years and 10 months, and 1960 who claimed after 67 years.
Postponing Social Security benefits until 70 years old after full retirement will increase your benefit amount.
How does the federal agency determine the cost of living adjustment every year?
The annual cost of living adjustment for urban wage earners and clerical workers is linked to increases in the Consumer Price Index, as stated by the Social Security Act (Bureau of Labor Statistics).
Since 1975, Social Security has reported annual growth. Previously, increases required Congressional approval, which did not occur every year.
The cost-of-living adjustment for this year is the lowest since 2021, when the Bureau of Labor Statistics confirmed it at 1.3%. Based on historical data from Social Security, here are the last cost-of-living adjustment (COLA) increases in the last ten years:
| Year | COLA increase |
| 2015 | 1.70% |
| 2016 | 0% |
| 2017 | 0.30% |
| 2018 | 2% |
| 2019 | 2.80% |
| 2020 | 1.60% |
| 2021 | 1.30% |
| 2022 | 5.90% |
| 2023 | 8.70% |
| 2024 | 3.20% |
How much tax should beneficiaries pay in Social Security benefits?
Every year in January, Social Security adjusts monthly benefits based on average pay increases. This raise will result in a planned increase to the maximum wage subject to Social Security taxes, which could range from $168,600 to $176,100.
Until then, self-employed people paid 12.4% of wages, while employers and employees each paid 6.2%. The total income for the OASI and DI trusts in 2023, including interest, is $1,351 billion ($67 billion from interest, $51 billion from benefit tax, and $1,233 billion from net payroll tax).
Can beneficiaries earn additional money besides Social Security benefits?
Yes, but if your earnings exceed $62,160, you may be required to pay income taxes. The maximum payment for those reaching full retirement age (FRA) in 2025 is $62,160.
For example, the Social Security Administration (SSA) will deduct one dollar from Social Security benefits for every three dollars earned over $62,160 by the month the beneficiary reaches FRA. Employees who are “full” retirement age or older, on the other hand, are not subject to an earnings cap throughout the year.