The 2019 COLA increased SSDI payments by 2.8 percent

In October 2018, the Social Security Administration announced that SSDI payments would rise by 2.8 percent starting in January 2019. This was the annual cost of living adjustment, or COLA. If you received SSDI in 2019, your monthly payment went up by that percentage in the first week of January.

The 2.8 percent increase was based on inflation measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of 2017 through the third quarter of 2018. Social Security calculates the COLA each year using this same method, comparing prices from one year to the next.

For someone receiving the average SSDI payment in 2018, the 2.8 percent increase meant roughly $30 to $40 more per month, though the exact amount depended on what you were receiving before the adjustment. Family members who received benefits based on your record also received the same percentage increase.

Key Takeaways

  • The 2019 COLA of 2.8 percent was applied to all SSDI payments starting January 2019, with no action required from beneficiaries.
  • The increase was calculated using inflation data from mid-2017 through mid-2018, following the standard annual COLA formula.
  • Family members receiving benefits on your record received the same 2.8 percent increase to their own payments.
  • The 2019 COLA was higher than the 2018 adjustment of 2.0 percent but lower than some years in the past decade.

How the 2019 COLA was calculated

Social Security does not choose the COLA amount. Instead, it is set by law using a specific formula tied to inflation. The Social Security Administration compares the Consumer Price Index from July, August, and September of one year to the same three months in the previous year. For the 2019 COLA, they compared those months in 2018 to 2017.

When inflation is higher, the COLA is higher. When inflation is lower, the COLA is lower. In some years when inflation is negative or very small, there is no COLA at all—beneficiaries' payments stay the same. This happened in 2010, 2011, and 2016. The 2.8 percent in 2019 reflected moderate inflation during that period.

What changed in your payment in January 2019

If you were receiving SSDI on January 1, 2019, you saw the increase automatically. You did not need to contact Social Security or take any action. The new payment amount appeared in your bank account or check on the first business day of the month, following your normal payment schedule.

The increase applied to your primary insurance amount—the base payment on which your benefit is calculated. If you had a representative payee managing your benefits, they received the increased amount on your behalf. If you were working and your benefits were reduced due to earnings, the 2.8 percent increase was applied before that reduction was calculated.

How the 2019 COLA compared to other years

The 2.8 percent increase in 2019 was moderate by recent standards. The year before, in 2018, the COLA was 2.0 percent. In 2017, it was 0.3 percent—one of the smallest adjustments on record. Going back further, 2016 had no COLA at all, while 2015 saw a 1.7 percent increase.

The largest COLA in the past decade was 5.8 percent in 2009, during a period of higher inflation. The 2.8 percent in 2019 fell in the middle range of what beneficiaries have seen since 2010. Each year's adjustment reflects the inflation that occurred during that specific period, so there is no way to predict whether future COLAs will be higher or lower.

Why the COLA matters for your budget

For people living on a fixed SSDI payment, even a small percentage increase can matter. A 2.8 percent raise means slightly more money for rent, food, medicine, or other expenses. Over the course of a year, the increase compounds—you receive the higher amount every month for all twelve months.

However, the COLA does not always keep pace with the actual costs you face. Healthcare expenses, housing, and other necessities sometimes rise faster than the general inflation rate that Social Security uses to calculate the COLA. This is why some beneficiaries still struggle with expenses even after a COLA increase.

Frequently Asked Questions

Did I have to do anything to get the 2019 COLA increase?

No. The increase was automatic. If you were receiving SSDI on January 1, 2019, the 2.8 percent was added to your payment without any action on your part. You did not need to contact Social Security or fill out any forms.

What if I started receiving SSDI after January 2019?

Your initial payment amount would have already reflected the 2019 COLA. Social Security calculates new beneficiaries' payments using current rates, so you would not receive a separate increase later that year.

Did my family members' benefits increase too?

Yes. If your spouse, children, or other family members were receiving benefits based on your record, they each received the same 2.8 percent increase to their own payments starting in January 2019.

How does the COLA affect my earnings limit if I'm working?

The COLA increases your primary insurance amount, but it does not change the earnings limit that reduces your benefits. In 2019, the limit was $17,640 per year if you had not yet reached full retirement age. Your increased benefit amount is still reduced dollar-for-dollar above that limit.

Will future COLAs be the same as 2019?

No. Each year's COLA is calculated fresh based on that year's inflation data. The 2020 COLA, announced in October 2019, was 1.6 percent. Future adjustments depend entirely on inflation rates during the measurement period.