2. What should you know if you are not yet retired about COLA in 2024?
Remember that the COLA benefits are always calculated based on the money you receive from Social Security. Let’s say that you start claiming the benefits at the age of 62. In this case, your PIA will be reduced by 75%.
Your COLA rise will be determined using that amount rather than the whole sum you would earn if you waited to file until full retirement age. This can make a real difference in the amount of money you receive.
For every year you delay your retirement, your benefits can increase substantially. If we give an example of someone who starts receiving benefits at the age of 62 in 2021, by the age of 70, with a COLA increase of only 2.5%, they will be receiving just $2330 per month.
But if this person had waited until they were 70 years old to claim the benefits, they would have received $4101 per month. This is a huge difference! When you take into account years like 2023, when the COLA grew by 8.7%, the gain will be much bigger.
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