Yes, SSDI payments increase each year when the cost of living rises

Social Security Disability Insurance (SSDI) payments do go up when prices for everyday things rise. This yearly increase is called a Cost of Living Adjustment, or COLA. Social Security calculates it using inflation data from the previous year and adds it to your monthly payment starting in January.

The amount of the increase changes from year to year because inflation itself changes. Some years the COLA is small — 1.3 percent in 2022. Other years it is larger — 8.7 percent in 2023. You do not have to do anything to receive it. If you are already getting SSDI, the higher amount straightforward shows up in your January payment.

The COLA applies to everyone on SSDI at the same rate. A person receiving $800 per month and a person receiving $1,500 per month both get the same percentage increase, so the person with the higher payment receives a larger dollar amount added to their check.

Key Takeaways

  • SSDI payments automatically increase each January by a percentage that matches inflation from the previous year.
  • The COLA amount varies year to year — it is not a fixed percentage and depends on how much prices actually rose.
  • You receive the increase without explore or contacting Social Security; it happens automatically if you are on SSDI.
  • The percentage increase is the same for everyone, but people with higher payments receive a larger dollar amount added to their check.
  • Social Security announces the COLA in October for the January increase that follows.

How Social Security calculates the yearly increase

Social Security uses a specific measure of inflation called the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This index tracks price changes for food, housing, transportation, medical care, and other common expenses. Social Security looks at the average CPI-W for the third quarter of the current year (July, August, and September) and compares it to the average for the same three months in the previous year.

If prices went up, the percentage increase becomes the COLA. If prices went down or stayed flat, there is no COLA that year — your payment stays the same. This has happened only three times since 2000: in 2010, 2011, and 2016.

Social Security announces the COLA in mid-October each year. The increase takes effect on January 1 of the following year. Your January payment will reflect the new, higher amount.

What the COLA does and does not cover

The COLA is meant to help your payment keep pace with rising prices. If rent, groceries, and medicine all cost more, your SSDI payment increases by roughly the same percentage. This protects you from losing purchasing power as inflation happens.

However, the COLA does not always match your personal expenses. If you spend more on medical care than the average person, or if housing costs in your area rose faster than the national average, the COLA may not fully cover your increased costs. The adjustment is based on national inflation data, not on what you personally spend money on.

The COLA also does not change the rules for how much you can earn while on SSDI, or how much money you can have in savings. Those limits stay the same unless Congress changes them separately.

When you start SSDI and the first COLA

If you start receiving SSDI in the middle of the year, you still receive the COLA increase the following January. For example, if you begin SSDI in June, your first payment is whatever the current monthly amount is. The next January, that payment increases by that year's COLA percentage.

Your first SSDI payment itself is not reduced because you started partway through the year. Social Security pays you the full monthly amount for each month you are on the program, regardless of when you start.

COLA and other benefits you might receive

If you receive both SSDI and Supplemental Security Income (SSI), you get a COLA on both payments. The percentage is the same, but the two payments are calculated separately, so the dollar amount added to each one may differ.

If you are the spouse or child of someone on SSDI and you receive a family benefit, your payment also increases by the same COLA percentage each January.

If you are on SSDI and also receive a pension from work you did for a government employer (such as a city or state job), a different rule called the Government Pension Offset may reduce your SSDI payment. The COLA still applies to your SSDI portion, but the offset itself does not change.

Checking your payment after the COLA takes effect

You should see the increased amount in your January payment. If you receive SSDI by direct deposit, the new amount will appear in your bank account. If you receive a check, it will show the higher payment.

Social Security sends a notice in December or early January showing your new payment amount and explaining the COLA. Keep this notice for your records. If the amount seems wrong, contact Social Security to ask about it.

You can also check your payment amount anytime by logging into your my Social Security account at ssa.gov, or by calling Social Security at 1-800-772-1213.

What happens if you disagree with the COLA amount

The COLA is set by law based on the CPI-W calculation. You cannot dispute the percentage itself — it applies to everyone on SSDI the same way. However, if you believe Social Security made an error in calculating your specific payment, you can ask them to review it.

Contact your local Social Security office or call 1-800-772-1213 to report a concern about your payment amount. Be ready to explain what you think is wrong and provide any documents that support your concern.

Frequently Asked Questions

What was the COLA for this year?

The COLA changes each year based on inflation. To find the current year's COLA percentage, visit ssa.gov or call Social Security at 1-800-772-1213. Social Security announces the COLA in October for the January increase that follows.

If I am not on SSDI yet, will I get a COLA when I start?

Yes. Once you begin receiving SSDI, you are included in the COLA process. Your first January on SSDI, you will receive that year's COLA increase on your payment, just like everyone else on the program.

Can the COLA ever be negative?

No. If inflation is zero or negative, there is straightforward no COLA that year — your payment stays the same. Social Security does not reduce payments based on deflation.

Does the COLA explore to my family members who get benefits based on my SSDI?

Yes. Spouses, children, and other family members receiving benefits based on your SSDI record all receive the same COLA percentage increase each January.

How much will my payment go up?

The dollar amount depends on your current payment and that year's COLA percentage. If your payment is $1,200 and the COLA is 3 percent, your payment increases by $36. Social Security will show you the exact new amount in your December or January notice.