SignalsAZ.com Prescott News Podcast - How the 2025 COLA Affects Social Security Disability Benefits

Episode Date: January 2, 2025

Send us a text and chime in!The Social Security annual cost-of-living adjustment (COLA) provides beneficiaries with a hedge against rising prices. This includes all beneficiaries, not just retirees and survivors but also people who receive disability payments. So people collecting Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI), the two types of payments Social Security administers for people unable to work due to a serious health condition, will get a 2.5 percent increase in their monthly benefits in 2025. The COLA tracks changes in consumer prices year to year and is applied to benefit amounts. Other measures that chart national trends in wage growth... For the written story, read here >> https://www.signalsaz.com/articles/how-the-2025-cola-affects-social-security-disability-benefits/Check out the CAST11.com Website at: https://CAST11.com Follow the CAST11 Podcast Network on Facebook at: https://Facebook.com/CAST11AZFollow Cast11 Instagram at: https://www.instagram.com/cast11_podcast_network

Text to Speech audio articles made possible by the Quest Grant at Yavapai College. Tuition-free industry recognized certificates for your career. The Social Security Annual Cost of Living Adjustment, COLA, provides beneficiaries with a hedge against rising prices. This includes all beneficiaries, not just retirees and survivors, but also people who receive disability payments. So people collecting Social Security Disability Insurance, SSDI, or Supplemental Security Income, SSI, the two types of payments social security administers for people unable to work due to a serious

health condition will get a 2.5% increase in their monthly benefits in 2025. The COLA tracks changes in consumer prices year to year and is applied to benefit amounts. Other measures that chart national trends in wage growth can affect eligibility and payments for SSDI and SSI recipients. Here are some of the changes those groups will see in 2025. SDI benefit amounts About 7.3 million workers received SSDI as of August 2024, representing 10.7% of all Social Security beneficiaries. Like retirement benefits, SSDI is paid out of payroll tax revenue that flows into Social Security's trust funds, and eligibility and benefit amounts are determined by a worker's earnings record. According to the Social Security Administration, SSA, the 2025 COLA will increase the estimated average monthly SSDI benefit for a worker with a disability by 30. starting in January, from $1,542 to $1,580. Nearly 1.1 million family members also receive SSDI on the earnings record of a spouse, former spouse, or parent with a disability.

The average collective benefit for an SSDI recipient with a spouse and child, or children, collecting benefits on the record will increase in January from $2,757 a month to $2,826. $SDI income limits. Because disability benefits are contingent on a person being largely unable to work, Social Security sets an income ceiling for people receiving SSDI. Beneficiaries who exceed this cap on what the SSA calls substantial gainful activity, SGA, will, in most cases, lose their SSDI eligibility. The SGA cap is adjusted annually based on the National Average Wage Index, an SSA measure of historical trends in U.S. wages. In 2025, most SDI recipients will be able to earn up to $1,620 a month from work without risk to their benefits, up from $1,550 in 2024.

The cap is higher for beneficiaries who are blind, they will be able to make up to $2,700 a month, a $110 increase from 2024. Social Security offers several work incentives aimed at helping people with disabilities explore options for returning to work. One of these is a trial work period, an SDI recipient can work and earn any amount of income for any nine months over a rolling five-year period without losing benefits. In 2025, the SSA counts a month toward your trial work period quota if you earned at least $1,160, up from $1,110 in 2024. SSI Federal Payments Supplemental security income is distinct from traditional social security benefits. It is funded by general U.S. tax revenue, not Social Security payroll taxes, for one thing, but the SSA

administers this safety net program, delivering monthly benefits to about 7.4 million people who are 65 or older, blind or disabled, and have very low incomes and few financial resources. With the 2025 COLA, the maximum federal payment to an individual SSI recipient will go up from $943 a month to $967. Most states provide supplemental payments to some SSI beneficiary. A married couple in which both spouses are SSI eligible can receive up to $1,450 a month, up from $1,415 in 2024. SSI benefits are generally paid on the first of the month, but because January 1st is a federal holiday, SSI recipients get their first COLA- boosted payment on the prior business day, in this case, Tuesday, December 31st. Most people applying for SSI are subject to substantial gainful activity limits at the filing stage.

If their work income exceeds the cap when they claim benefits, the claim will likely be denied. The SGA cap does not apply once an applicant has been approved for and receives SSI. However, once people start getting SSI, they are subject to a different income limit. If they are working or receiving money from other sources, such as government benefits, investments, or family members, a portion of that income is deducted from their monthly SSI payment. If this countable income exceeds the 2025 federal payment standard of $967 for a single person and $1,450 for a couple, they will get no SSI benefit that month. The annual change in income limits has an additional impact on some younger people receiving SSI due to disability or blindness. Those regularly attending a secondary school, college, or university or getting vocational or technical training can earn up to a certain amount from work each month and not have account against their SSI benefit.

In 2025, this student-earned income exclusion increases from $2,2,2,290 to $2,350 a month, up to an annual maximum of $9,460, $9,230 in 2024. Content published with permission from AARP and originally published on AARP.org. Retirement done right in Prescott is made possible by touchmark at the ranch of Prescott, Arizona. Read more from Retirement done right on Signals AZ.com. Be in the No with the F1 RSD 2 No Ultimate Holiday Guide.