The average person collecting a retired worker benefit from Social Security receives $1,905.31 a month, according to the 2024 Social Security Statistical Supplement. However, the average 69-year-old beneficiary gets $1,945.18 -- about $40 more per month than the average retired worker.

Social Security benefits will arguably lose buying power next year because the 2.5% COLA understates inflation.

The House is expected to try to pass a Social Security-related bill this week to ensure benefits for workers who are also eligible for other pensions, despite a surprise move by hard-right Freedom Caucus leaders to derail the effort.

It’s a quick turnaround to salvage what had been a bipartisan effort to pass the bill during what’s now the lame-duck post-election period of the Congress.

But unfortunately, next year's COLA won't be quite as substantial. Because of cooling inflation, Social Security benefits are only going to receive a 2.5% raise in 2025.

A good rule of thumb to figure out your retirement savings needs is to come up with an annual income you expect to need, subtract your annual Social Security benefit, and then multiply the remaining number by 25.

Inflation affects everyone, but it's especially noticeable for those with fixed-income sources like Social Security. The good (but could-be-better) news, though, is that Social Security has a system in place to try to put a bandage on this issue.

Still, the recent news raises a handful of questions among the retirees it impacts the most. Here are a few things you might want to know about these annual cost-of-living adjustments. The annual COLA isn't a number arbitrarily decided by the Social Security Administration.