Office of the Chief Actuary 

Social Security AdministraƟon 

 Based on the 2023 Trustees Report Intermediate AssumpƟons 

An annual cost-of-living adjustment (COLA) applies to benefits aŌer iniƟal eligibility. 

For each provision, we provide an esƟmate of the financial effect on the OASDI 

program over the long-range period (the next 75 years) and for the 75th year. We base 

all esƟmates on the intermediate assumpƟons described in the 2023 Trustees Report. 

A Provisions AffecƟng Cost-of-Living Adjustments 
Long-range 

actuarial 

balance

Annual 

balance in 

75th year

Long-range 

actuarial 

balance

Annual 

balance in 

75th year

A1 1.95 2.47 54% 57%

A2 1.02 1.30 28% 30%

A3 0.62 0.80 17% 18%

A4 0.48 0.63 13% 14%

A5 -0.13 -0.14 -3% -3%

A6 -0.42 -0.56 -12% -13%

A7 1.84 2.33 51% 54%

A8 0.54 0.69 15% 16%

A9 1.31 2.21 36% 51%

Starting December 2024, reduce the annual COLA by 1 percentage point, 

but not to less than zero. In cases where the unreduced COLA is less than 

1 percentage point, do not carry over the unused reduction into future 

years.

Description of proposed provisions

Change from current law

(percent of payroll)

Shortfall eliminated

Category A: Cost-of-Living Adjustment (2023 Trustees Report intermediate assumptions)

Current law shortfall in long-range actuarial balance is 3.61 percent of payroll and in annual balance for the 75th year is 4.35 percent of payroll.

Starting December 2024, reduce the annual COLA by 1 percentage point.

Starting December 2024, reduce the annual COLA by 0.5 percentage 

point.

Starting December 2024, compute the COLA using a chained version of 

the consumer price index for wage and salary workers (CPI-W). We 

estimate this new computation will reduce the annual COLA by about 0.3 

percentage point, on average.

Starting December 2026, compute the COLA using a chained version of 

the consumer price index for wage and salary workers (CPI-W). We 

estimate this new computation will reduce the annual COLA by about 0.3 

percentage point, on average. The new COLA will not apply to DI benefits. 

It will apply to OASI benefits, except for those of formerly disabledworkers who converted to retired-worker status.

Starting December 2024, add 1 percentage point to the annual COLA for 

beneficiaries who have lived past a specified age. The specified age is the 

sum of: (1) 65 and (2) the unisex cohort life expectancy at age 65.

Starting December 2025, compute the COLA using the Consumer Price 

Index for the Elderly (CPI-E). We estimate this new computation will 

increase the annual COLA by about 0.2 percentage point, on average.

Starting December 2024, for OASI beneficiaries only (DI beneficiaries 

would only be affected when their benefit converts to OASI at NRA), the 

annual COLA would be based on the chain-weighted version of the CPI-U.

For single/head-of-household/married-filing-separate taxpayers with 

modified adjusted gross income (MAGI) below $108,700 and for joint 

filers with MAGI below $217,400 for December 2025 ($85,000 and 

$170,000 multiplied by estimated CPI-U for 2018-2025), use the chainweighted version of the Consumer Price Index for All Urban Consumers (CCPI-U) to calculate the cost-of-living adjustment (COLA), beginning with 

the December 2025 COLA. For those beneficiaries whose MAGI is above 

these thresholds, provide no COLA. Use prior tax year income data for this 

determination. Use the chain-weighted CPI for the COLA for years prior to 

benefit receipt. Index the eligibility income threshold amounts to the CPIU after December 2025.

Office of the Chief Actuary

Social Security Administration

Based on the 2023 Trustees Report Intermediate Assumptions