Social Security COLAs are tied directly to inflation. Therefore, when one goes down, it indicates that the other is down, too. In other words, a smaller 2025 COLA means inflation has been cooling. If that trend continues, seniors on Social Security could gain buying power in the form of lower prices in stores and in general.

The Social Security Administration (SSA) distributes benefit payments to millions of Americans every month—but given the sheer number of beneficiaries, not everyone is paid on the same date. These benefits include retirement, disability and survivor benefits, with around $1.5 trillion expected to be paid out throughout this year.