January 1 Brings an Average Increase in Disability Benefits – Here’s How Much: Check Important Details

By Ronald Rodriguez Last updated Dec 26, 2024

As the new year begins, Social Security Disability Insurance (SSDI) recipients can expect a welcome boost in their monthly payments.

Starting January 1, the average increase in disability benefits will provide critical financial relief to millions of Americans living with disabilities. Here’s what you need to know about the upcoming increase, how much it will affect your payments, and other important details.

What Is the Disability Benefits Increase?

The Social Security Administration (SSA) typically adjusts benefits every year to keep pace with inflation. This year, beneficiaries of SSDI will see an average increase of 3.2% in their payments, based on the Cost of Living Adjustment (COLA). This COLA increase is meant to offset the rising cost of living, helping beneficiaries maintain their purchasing power in the face of inflation.

The COLA adjustment is calculated using the Consumer Price Index (CPI), which tracks the price changes in various goods and services that individuals typically purchase. When inflation rises, the SSA uses this data to determine how much of an increase is needed to ensure that disability payments keep up with the increased costs of living.

How Much Will the Increase Be?

For SSDI beneficiaries, the average increase means more money in their monthly payments starting January 1, 2024. The exact amount varies depending on each individual’s benefit amount, which is based on their lifetime earnings and the date they became disabled. However, here are some key figures:

Average monthly SSDI payment: The average disability benefit will increase by 3.2%, which translates to an extra $63 per month for the average recipient. For someone receiving $2,000 per month, this would mean an increase of about $64.
Maximum SSDI benefits: For those who qualify for the highest possible SSDI benefit, the increase could be significantly higher. Individuals who qualify for the maximum benefit will see an additional $150 or more per month, depending on their previous benefit amount.

While these amounts may seem modest, they are crucial for beneficiaries who rely on SSDI to meet basic living expenses.

How Will the Increase Impact You?

The 3.2% COLA increase will affect everyone receiving SSDI, but the total amount of the increase depends on your specific benefit. Here are some examples to show how the increase might impact different levels of benefits:

$1,000 monthly payment: An increase of $32 per month.
$1,500 monthly payment: An increase of $48 per month.
$2,500 monthly payment: An increase of $80 per month.

For those struggling to make ends meet, every bit helps. The increase may not cover every expense, but it can provide some relief when it comes to rising costs, such as groceries, rent, utilities, and medical expenses.

Will You Automatically Receive the Increase?

SSA Confirms Exception How to Receive Your January Social Security Payment Early

Yes, the increase will be applied automatically. SSDI recipients do not need to take any action to receive the new, higher payment. The 3.2% increase will be automatically included in your benefits starting January 1, and you should see the change reflected in your February 2024 payment. If you receive your payments by direct deposit, the new amount will be deposited into your account automatically.

Important Notes About the Increase

Supplemental Security Income (SSI): The Supplemental Security Income (SSI) program, which provides assistance to low-income individuals who are elderly or disabled, will also see a similar COLA increase. In 2024, the SSI benefit is expected to rise by the same 3.2%, although the exact amount will vary based on the individual’s living situation and income.
Review Your Payment: Although the increase will be automatic, it’s always a good idea to check your Social Security statement or the online Social Security account to confirm your updated payment amount.
Impact on Taxes: Keep in mind that disability benefits may be subject to taxes if your total income (including other sources) exceeds a certain threshold. While the COLA increase is unlikely to push most recipients over the threshold, it’s still worth checking if the additional income impacts your tax liability.
Other Benefits: In addition to SSDI, the SSA also oversees Social Security Retirement benefits, which also receive a COLA increase. So, if you are also receiving retirement benefits in addition to disability benefits, you will see a similar increase in both.

Why Is the COLA Increase Important?

The COLA increase is especially important for SSDI recipients, as many rely solely on their benefits to cover living expenses. With inflation impacting everything from food to gas to healthcare, the annual adjustment helps recipients keep pace with the rising cost of everyday goods and services.

While the 3.2% increase may not completely cover all inflationary costs, it provides a much-needed boost for people who are unable to work due to disability. The COLA adjustment ensures that the purchasing power of disability benefits remains stable over time, offering financial support in challenging economic conditions.

Conclusion

Starting on January 1, 2024, SSDI recipients will see an average 3.2% increase in their monthly benefits, thanks to the Cost of Living Adjustment (COLA). While the increase may seem small, it offers critical financial relief for millions of disabled Americans who rely on these benefits. The boost will automatically be reflected in your payments starting February 2024, and you don’t need to take any action to receive it.

If you’re a recipient, it’s a good idea to review your updated payment details once the increase is applied, and stay informed about any additional changes that may affect your benefits in the future.