Yes, SSDI payments increase each year through a cost of living adjustment

Social Security Disability Insurance (SSDI) payments do get a cost of living adjustment (COLA) every year. This means your monthly benefit amount goes up automatically in January to account for inflation — you do not have to ask for it or reapply.

The adjustment is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which measures how prices change for things people buy every day. When prices rise, your COLA rises with it. When inflation is low or prices fall, your COLA may be smaller or, in rare years, zero.

The Social Security Administration announces the COLA percentage in October, and the increase shows up in your January payment. You will receive a notice in the mail explaining the new amount.

Key Takeaways

  • COLA increases happen automatically every January — you do not need to do anything to receive the adjustment.
  • The percentage increase is set by the Consumer Price Index for Urban Wage Earners and Clerical Workers and announced each October.
  • Your new payment amount appears in your January benefit without requiring a new process or review.
  • COLA has varied from zero percent in some years to over 8 percent in others, depending on inflation rates.

How the COLA percentage is calculated

The Social Security Administration compares the average Consumer Price Index from July, August, and September of the current year to the same three months from the previous year. The percentage difference becomes that year's COLA.

This means the COLA you receive in January 2025 is based on price changes measured in mid-2024. The lag between when prices change and when your payment adjusts is built into the system.

If prices have not risen compared to the previous year, COLA can be zero. This happened in 2010, 2011, and 2016. In years with high inflation — like 2022 — COLA has been much larger, reaching 8.7 percent.

When the COLA increase appears in your payment

The increase always takes effect in January. If you receive SSDI by direct deposit, the new amount will be in your account on the third day of the month (or the first business day after if the third falls on a weekend or holiday). If you receive a paper check, it arrives in early January with the new amount.

You will also receive a notice called the "Social Security Benefit Statement" in December or early January showing your old payment amount and your new payment amount after the COLA increase.

What happens to your other benefits when SSDI increases

If you receive Supplemental Security Income (SSI) in addition to SSDI, SSI also receives a COLA increase. The two programs use the same adjustment percentage.

If family members receive benefits on your SSDI record — such as a spouse or child — their payments also increase by the same percentage in January.

If you are working and earning income while on SSDI, the COLA increase does not change your work incentives or the amount you can earn before benefits are affected. Your Substantial Gainful Activity (SGA) limit and other work-related thresholds are adjusted separately, usually also in January.

COLA and your Medicare or Medicaid coverage

A COLA increase to your SSDI payment does not automatically change your Medicare or Medicaid coverage. You keep the same coverage you had before.

However, if you receive both SSDI and SSI, and your SSI payment increases due to COLA, that increase might affect your SSI may be able to access in future months because SSI has income and resource limits. This is rare and usually only matters if you are close to the SSI resource limit of $2,000 (or $3,000 if you are married).

Checking your COLA before January

You can see what your new SSDI payment will be before January arrives. The Social Security Administration publishes the COLA percentage in October on its official website. You can then multiply your current payment by the COLA percentage to estimate your new amount.

For example, if your current payment is $1,200 and the COLA is 3.2 percent, your new payment would be approximately $1,238.40.

You can also create a my Social Security account at ssa.gov to view your payment history and current benefit amount. The account will show your updated payment amount once it is processed in December.

What COLA does not cover

COLA adjusts your SSDI payment, but it does not adjust other costs related to your disability or medical care. Your out-of-pocket costs for medications, medical equipment, or services may rise faster than your COLA increase.

If you are concerned that your payment is not keeping up with your actual living expenses, you can contact your local Social Security office to discuss your situation, though COLA itself is set by law and cannot be changed on a case-by-case basis.

Frequently Asked Questions

Can I choose not to receive the COLA increase?

No. COLA is automatic and applies to all SSDI beneficiaries. You cannot opt out of the increase, and it does not require any action on your part.

What if I disagree with the COLA percentage announced?

The COLA percentage is set by law based on the Consumer Price Index. Individual beneficiaries cannot dispute it. If you believe there is an error in how the COLA was calculated or applied to your specific payment, you can contact Social Security to ask them to review your account.

Does COLA explore if I am working while on SSDI?

Yes. COLA increases explore to all SSDI beneficiaries regardless of whether they are working. Your payment goes up in January along with everyone else's, though your work incentives and earnings thresholds are adjusted separately.

Will COLA increase if I move to a different state?

Yes. COLA is a federal adjustment that applies to all SSDI beneficiaries nationwide. Your state of residence does not affect whether you receive the increase or how much it is.

What if my COLA increase causes me to lose SSI?

If you receive both SSDI and SSI, a COLA increase to your SSDI payment could reduce your SSI payment or end your SSI in some cases, because SSI counts SSDI as income. Contact your local Social Security office before January if you are concerned this might happen to you.