The Social Security Administration has announced a 3.2% cost-of-living adjustment (COLA) increase in 2024 for benefits issued under Social Security and Supplemental Security Income (SSI). The increase is meant to help beneficiaries keep up with higher expenses resulting from inflation.
Eligibility for SSI
Eligibility to receive SSI benefits is extended to persons meeting the following criteria:
- You must be 65 years old or older, blind, or disabled.
- To be eligible, you must not have much income or possess many sources to count.
- Be a U.S. citizen or national or be in an eligible non-citizen category
The COLA change in no way affects the amount of work credits one must have in order to be eligible for SSI benefits.
Work credits for SSI Eligibility
Unlike the Social Security retirements benefits that are merit-based and pegged upon one’s work history as well as earnings, the SSI program is a needs-based initiative. In this sense, eligibility for SSI benefits relies not upon how many work credits are held by the applicant.
The truth, in fact, of the matter is that the actual number of work credits you need to file for retirement at 62 will be the same after the 2025 Social Security COLA increase. It’s just that you will need more money in earnings to obtain one single credit.
Workers normally require about 40 work credits in general to qualify for retirement benefits from Social Security, and around 20 of the credits must be earned in the ten years directly before retirement. There is an exception for SSI, so that does not pertain to SSI.
How the 2025 COLA may affect Social Security
In the eventuality that there is an increase in the COLA, a corresponding increase in retirement benefit is afforded. In this manner, the Social Security Administration serves in keeping the buying power of the retirees, without which they might no longer make both ends meet as inflation goes to the ceiling.
The thing is, the same way retirement benefits increase, the quarter of coverage does, as well. That is, the money one needs to make over a year to earn one single work credit.
For example, the amount you had to earn in 2023 to get 1 work credit was $1,640. Well, that was $1,730 in 2024. It actually increased by more than the 3.2% COLA.
You can only earn a maximum of 4 credits in a single year. What changes are the number of credits you have over a set duration of your working life, which introduces one’s eligibility to any benefits but what you earn does not affect the amount of benefits you receive.
How much did the Social Security quarter of coverage go up by?
After the 2024 COLA increase, the quarter of coverage rose by 5.49%. Now, in 2024, the price of just one credit equals $1,730. So, in covered earnings, you would have to have $6,920 to get the 4 credits of work which is a maximum that one can get per year. Remember, you can’t buy work credits. A taxpayer can only get work credits that he or she can use in the future for retirement benefits by paying taxes to the Social Security Administration.
Effect of COLA on SSI Benefits
Even after its reform, it will not affect the COLA in changing the eligibility requirements for SSI. It will; however, lead to a revision of maximum federal SSI payment amounts. The amounts of maximum federal SSI payment will change to:
- $943 monthly for unsponsored person
- $1,415 monthly for unsponsored individual with unsponsored spouse
It should be noted that SSI will be subject to reduction should the beneficiary earn more income or have more resources than the set-up amounts.
How to apply for SSI
Those interested in applying for SSI benefits can do so in their regional social security office or do so online at the SSA website. In most situations, an SSI application will demand that one:
- Submitting a filled and complete application form
- Providing all relevant documents to support the eligibility
- Attending the interview with a Social Security representative
- Receiving the application decision
