2025 Social Security COLA Set for Smallest Increase in Years Due to Cooling Inflation

The Social Security Administration's method for calculating cost-of-living adjustments (COLAs) using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) is particularly disadvantageous for the 20% of retirees living in rural areas, where inflation has been higher. This metric also inadequately reflects the costs incurred by seniors, especially in healthcare. Retirees are encouraged to monitor their spending and advocate for a more accurate inflation measure like the Consumer Price Index for the Elderly (CPI-E).