Glossary
COLA (Cost-of-Living Adjustment)
The yearly increase applied to Social Security payments to keep up with rising prices. It is said like the drink.
COLA stands for Cost-of-Living Adjustment, and it is said like the drink. It is the yearly raise applied to Social Security and Supplemental Security Income payments so they keep pace with rising prices. Social Security announces the adjustment each autumn, based on a measure of inflation, and the higher payments generally begin with the January payment. The increase is applied automatically. There is no form to fill in, no phone number to ring, and nothing to activate, which is worth remembering because callers claiming otherwise are a common problem every autumn. This matters to you because the raise does not always land in your pocket in full. If your Medicare Part B premium is deducted from your Social Security payment and that premium also rises, part of the increase can be absorbed before you ever see it.