What the 2023 COLA increase meant for your SSDI payment

In October 2022, the Social Security Administration announced an 8.7% cost of living adjustment (COLA) for 2023 — the largest increase in four decades. If you received SSDI in 2023, your monthly payment increased by 8.7% starting in January 2023. The size of your raise depended on what you were receiving in December 2022; there was no flat dollar amount added to everyone's check.

This 8.7% figure applied to all SSDI recipients, regardless of age or the reason for your disability. The increase was automatic — you did not need to contact Social Security or take any action to receive it. Your new payment amount appeared in your January 2023 deposit if you received direct deposit, or in your January 2023 check if you received payment by mail.

The 2023 COLA was tied to inflation measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). When inflation rises significantly from one year to the next, Social Security calculates the COLA as a percentage increase to keep benefits roughly aligned with the cost of living. The 8.7% increase reflected the steep inflation the country experienced in 2022.

Key Takeaways

  • The 2023 COLA raised every SSDI payment by 8.7%, effective January 2023, with no action required on your part.
  • Your specific dollar increase depended on your December 2022 payment amount — someone receiving $1,000 per month saw a raise of $87, while someone receiving $1,500 saw a raise of $130.50.
  • The 8.7% figure was the largest annual COLA increase since 1983 and reflected the high inflation of 2022.
  • COLA adjustments are calculated each year in October and take effect the following January for all Social Security and SSDI recipients.

How the 8.7% increase was calculated

Social Security uses a specific formula to turn the inflation rate into a percentage increase for your benefit. The agency measures inflation using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from July, August, and September of each year. If the average of those three months is higher than the average for the same three months in the previous year, Social Security calculates the percentage difference and rounds it to the nearest tenth of a percent.

For 2023, the CPI-W average for July through September 2022 was significantly higher than the same period in 2021, resulting in the 8.7% COLA. This percentage was then applied to the Primary Insurance Amount (PIA) — the base amount your SSDI payment is calculated from — for every beneficiary. The result was that each person's payment increased by exactly 8.7%, though the dollar amount of the raise varied based on how much they were receiving.

If you received $800 per month in December 2022, your January 2023 payment became $869.60. If you received $1,200 per month, your January 2023 payment became $1,304.40. The percentage stayed the same; only the starting amount changed the dollar outcome.

When you saw the 2023 COLA in your payment

The 2023 COLA took effect on January 1, 2023, and appeared in your first payment of that month. If you received direct deposit, the new amount hit your bank account on the date Social Security normally deposits your payment — usually the second, third, or fourth Wednesday of the month, depending on your birth date. If you received a paper check, the new amount appeared in your January check.

Social Security sent notices to all SSDI recipients in December 2022 explaining the 8.7% increase and showing your new payment amount. If you did not receive a notice, you could have viewed your new payment amount by logging into your my Social Security account online or by calling Social Security at 1-800-772-1213.

How the 2023 COLA affected your work incentives and other benefits

The 8.7% increase to your SSDI payment also raised the amount of money you could earn before your benefits were reduced under the Substantial Gainful Activity (SGA) limit. In 2023, the SGA limit for non-blind individuals was $1,470 per month (up from $1,350 in 2022). If you were blind, the SGA limit was $3,682 per month (up from $3,580 in 2022). These limits change each year based on the COLA.

If you received Supplemental Security Income (SSI) in addition to SSDI, your SSI payment also increased by 8.7%. The federal SSI benefit rate for 2023 was $914 per month for an individual (up from $841 in 2022) and $1,371 for a couple (up from $1,261 in 2022). Some states add money to the federal SSI amount, and those state supplements also increased by 8.7%.

If you had a family member receiving benefits on your SSDI record — such as a spouse or child — their payment also increased by 8.7% in January 2023. The family maximum, which is the total amount that can be paid to all family members on one SSDI record, also increased proportionally.

COLA announcements and timing for future years

Social Security announces the COLA for the following year in October of each year. The announcement is made on a specific date set by law, usually the second Thursday in October. The COLA then takes effect on January 1 of the following year. This means the COLA announced in October 2023 took effect in January 2024, the COLA announced in October 2024 takes effect in January 2025, and so on.

The COLA is not the same every year. It depends entirely on inflation as measured by the CPI-W. In years when inflation is low or negative, the COLA can be very small or zero. From 2009 to 2020, there were several years with no COLA increase at all because inflation was flat or negative. The 8.7% increase in 2023 was unusually large because inflation in 2022 was unusually high.

You can find the COLA for any year on the Social Security Administration website at ssa.gov, or you can call 1-800-772-1213 to ask what the current year's COLA is.

What to do if your January 2023 payment seemed wrong

If your January 2023 payment did not increase by approximately 8.7%, or if you received a notice showing a different COLA percentage, contact Social Security to report the discrepancy. Call 1-800-772-1213 or visit your local Social Security office in person. Have your Social Security number and your December 2022 payment amount ready so the representative can compare it to your January 2023 amount.

Errors in COLA calculations are rare, but they can happen if Social Security has incorrect information about your payment history or if there was a processing error. If an error is found, Social Security will correct your payment and send you a back payment for any months you were underpaid.

If you were receiving SSDI in December 2022 but did not receive a payment in January 2023, or if your payment stopped, contact Social Security when ready. Do not assume the payment will arrive late; this could indicate a problem with your case that needs to be addressed right away.

Frequently Asked Questions

Did everyone on SSDI get the same dollar amount increase in 2023?

No. Everyone got the same percentage increase (8.7%), but the dollar amount depended on what they were receiving in December 2022. Someone receiving $500 per month got a $43.50 raise, while someone receiving $2,000 per month got a $174 raise. The percentage was identical; only the starting amount changed the final dollar figure.

What if I started receiving SSDI after December 2022?

If you were approved for SSDI and received your first payment in January 2023 or later, your initial payment amount already included the 2023 COLA. You did not receive a separate increase; the COLA was built into your starting amount. Social Security calculates new awards using the current year's benefit formula, which reflects the most recent COLA.

Does the COLA increase affect Medicare premiums for SSDI recipients?

The COLA increase itself does not automatically raise your Medicare premiums. However, your income may have increased, which could affect whether you owe income tax on your benefits or whether you may have access to for other programs based on income limits. Contact Medicare at 1-800-633-4227 if you have questions about how your increased SSDI payment affects your coverage or costs.

Can I find out what my payment would have been without the 2023 COLA?

Yes. If you know your December 2022 payment amount, divide it by 1.087 to see what it would have been without the increase. For example, if your January 2023 payment was $869.60, your December 2022 payment was $800. The difference ($69.60) is your 8.7% COLA increase. Your Social Security statement online also shows your payment history month by month.

Will there be a COLA increase in 2024?

Yes, but the size of the increase depends on inflation in 2023. Social Security announced the 2024 COLA in October 2023. You can find the current year's COLA on the Social Security Administration website or by calling 1-800-772-1213. COLA increases happen every year unless inflation is zero or negative, which is rare.