The 2020 COLA raised SSDI payments by 1.6 percent

In October 2019, the Social Security Administration announced that the 2020 cost of living adjustment (COLA) would be 1.6 percent. This meant that starting with the December 2019 payment (received in January 2020), every SSDI recipient's monthly benefit increased by 1.6 percent of what they had been receiving in 2019.

The 1.6 percent figure came from the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which measures inflation across the economy. Social Security calculates COLA each year using the average CPI-W for July, August, and September of the prior year. If inflation was flat or negative, COLA would be zero — but in 2019, inflation was positive, so the 1.6 percent increase went into effect.

This was a smaller raise than the previous year. In 2019, SSDI recipients received a 2.8 percent COLA. The 1.6 percent in 2020 reflected slower inflation during the measurement period.

Key Takeaways

  • The 2020 COLA of 1.6 percent took effect with the December 2019 payment, which arrived in January 2020.
  • The exact dollar amount of your raise depended on your individual benefit amount — a person receiving $1,000 per month would see a $16 increase, while someone receiving $1,500 would see a $24 increase.
  • COLA is calculated using inflation data from July, August, and September of the prior year, so the 2020 figure was set months before it took effect.
  • If you were receiving SSDI in December 2019, the raise was automatic — you did not need to do anything to receive it.

How the 1.6 percent was calculated

The Social Security Administration does not choose the COLA percentage. Instead, it is determined by a formula tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This index tracks the cost of goods and services that working people buy — food, housing, transportation, medical care, and others.

Each year, SSA takes the average CPI-W for July, August, and September and compares it to the average for the same three months in the prior year. The percentage change becomes the COLA. For 2020, the CPI-W data from summer 2019 showed inflation of 1.6 percent compared to summer 2018.

This method means COLA is always based on actual inflation that has already happened, not a prediction. It also means the percentage is the same for all SSDI recipients — everyone gets 1.6 percent, whether they receive $500 per month or $3,000 per month.

What your actual dollar increase was

The 1.6 percent raise translated to different dollar amounts depending on your individual benefit. The formula is straightforward: multiply your December 2019 benefit amount by 0.016.

For example, if you were receiving $1,000 per month in December 2019, your January 2020 payment would have been $1,016 (a $16 increase). If you were receiving $1,500, your new amount would have been $1,524 (a $24 increase). Someone receiving $800 would have seen an $12.80 increase, rounded to $13.

Social Security rounds the final benefit amount to the nearest whole dollar, so some recipients saw slightly more or less than the exact 1.6 percent calculation. You could see your new amount by logging into your my Social Security account or by calling 1-800-772-1213 to speak with a representative.

When the raise took effect

The 2020 COLA took effect with the December 2019 payment. Social Security sends most SSDI payments on the third day of each month, but the actual deposit date depends on your birth date. If you were born between the 1st and 10th of the month, you received your December 2019 payment (with the raise) on the second Wednesday of December. If you were born between the 11th and 20th, you received it on the third Wednesday. If you were born between the 21st and 31st, you received it on the fourth Wednesday.

This staggered payment schedule has been in place since 2011 to spread out the volume of payments Social Security processes. The important point is that everyone's raise began in December 2019, not in January 2020 — the January 2020 deposit was straightforward when most people saw the new amount hit their account.

Why 2020 COLA was lower than 2019

The 2019 COLA was 2.8 percent, so the 1.6 percent in 2020 represented a significant drop. This happened because inflation slowed between summer 2018 and summer 2019. The CPI-W grew more slowly during that period, which is reflected in the smaller percentage increase.

COLA varies year to year based on actual inflation in the economy. In years when inflation is high, COLA is high. In years when inflation is low or flat, COLA is low or zero. There is no minimum or maximum — the formula straightforward follows the inflation data. This is why SSDI recipients sometimes see large raises and sometimes see small ones or no raise at all.

How to verify your 2020 benefit amount

If you wanted to confirm that your 2020 COLA was applied correctly, you had several options. The easiest was to create or log into your my Social Security account at ssa.gov. Once logged in, you could view your payment history and see the exact amount of each deposit, including the December 2019 payment with the raise included.

You could also call the Social Security Administration at 1-800-772-1213 (TTY 1-800-325-0778) and ask a representative to confirm your current benefit amount. Have your Social Security number ready. Representatives were available Monday through Friday, 7 a.m. to 7 p.m. Eastern time.

If you received a Social Security statement in the mail (which some recipients do automatically), it would have shown your new benefit amount starting in 2020. You could also request a replacement statement through your my Social Security account if you needed it for documentation purposes.

Frequently Asked Questions

Did I have to do anything to get the 2020 COLA raise?

No. If you were receiving SSDI in December 2019, the 1.6 percent raise was automatic. Social Security applied it to everyone's account at the same time. You did not need to contact them, submit paperwork, or take any action.

What if I thought my raise was calculated wrong?

Contact Social Security at 1-800-772-1213 with your Social Security number and ask them to review your December 2019 and January 2020 benefit amounts. They can confirm whether the 1.6 percent was applied correctly. If there was an error, Social Security can correct it and issue back pay if needed.

Does COLA affect Supplemental Security Income (SSI) the same way?

SSI recipients also received the 1.6 percent COLA in 2020, and it took effect at the same time. However, SSI has a federal benefit rate (the maximum monthly amount), which also increases with COLA. The rules for how COLA affects SSI are slightly different from SSDI, so if you receive both, contact Social Security to understand how it applied to your specific situation.

Will future COLA raises be similar to the 2020 amount?

No. COLA changes every year based on inflation. The 2020 COLA of 1.6 percent was specific to that year. Future years could see higher or lower percentages, or even zero percent if inflation is flat or negative. Social Security announces each year's COLA in October for the following year.