This article explores the 2025 Social Security COLA increase and highlights the 15 best cities for retirees. You may skip our analysis and jump to the 2025 Social Security COLA Increase: 5 Best Cities for Retirees.
2025 Social Security COLA Increase
As inflation continues to moderate, the Social Security Cost-Of-Living-Adjustment, or COLA, for 2025 is now forecast to fall short of last month’s 2.57% figure, according to the advocacy group for older Americans called Senior Citizens League (TSCL).
Based on the latest Social Security COLA update for 2025, retirees are now looking at an average monthly boost of $48 or a mere increase of 2.5%.
The COLA estimate for July was an estimated 2.63%, while that for August was 2.57%. Looking at the figures, it is evident that COLA estimates keep on dropping as inflation cools down further. According to the latest Bureau of Labor Statistics figures, inflation fell to a three-year low with prices slowing to 2.5% in the 12 months ending in August.
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While the official numbers are not out yet, it is quite likely, that the Social Security COLA update for 2025 isn’t as big as retirees would have hoped it to be. The Social Security Administration will typically determine COLA for 2025 in mid-October. If projections hold, a 2.5% increase would bring the average monthly benefit to $1,968, appearing in most recipients’ January checks.
Each year, the Social Security Administration determines the COLA by analyzing inflation during the third quarter, from July to September. It then calculates the average inflation rate for that period using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a measure that reflects the spending habits of working Americans.
If inflation for the current year exceeds that of the same period the previous year, the COLA is increased by the corresponding difference. The theory is that with the moderating inflation, older Americans will likely be able to make do without a larger increase. However, the truth is that such a small increase may not be enough to keep up with real-world expenses.
“[The COLA is] not going to be even close to covering increased household expenses for seniors”.
– Shannon Benton, the executive director of the Senior Citizens League.
Even though inflation may be slowing down, households are still going to feel the impact of high prices. This is because while prices aren’t rising, they aren’t falling either. Even if inflation returns to a normal rate, it doesn’t undo the sharp price increases that have already strained household budgets, a challenge many Americans continue to face.
According to the SSA, half of retirees who receive Social Security count on these checks for at least 50% of their household income. However, relying only on these benefits is not a viable approach. Supplementing your Social Security benefits with retirement plans such as those offered by The Charles Schwab Corporation (NYSE:SCHW) and Fidelity Investments can help live a more comfortable retirement.
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Methodology
To compile our list of 15 best cities for retirees to live on Social Security, we began by identifying U.S. cities with a low cost of living and high livability, drawing from previous rankings and reputable sources. We then evaluated these cities based on key factors such as the cost of living index, rental rates, median home prices, and overall livability scores, selecting the top 15 cities with the highest combined rankings.
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Here are the 15 best cities for retirees based on the 2025 Social Security COLA Increase:
15. Columbus, Georgia
Insider Monkey Score: 8
IM Cost of Living Index: 85.5
Livability Score: 64
For the retiree who wishes to enjoy the amenities of a large city without giving up on small-town charm, Columbus is a charming city to consider. Whether you’re walking down the Chattahoochee RiverWalk taking in the mesmerizing views of the river, or simply enjoying the vibrant energy that its downtown offers, this city won’t fail to impress.
14. Springfield, Missouri
Insider Monkey Score: 10
IM Cost of Living Index: 84.5
Livability Score: 74
Despite the small Social Security COLA increase in-store for retirees, Springfield is one of the best cities for retirees where the impact of rising prices would feel comparatively smaller. The cost of living in the city is 15.5% lower than the national average, making it an affordable destination to retire to. It also promises a top-notch healthcare system as well as access to abundant recreational activities.
13. Clarksville, Tennessee
Insider Monkey Score: 11
IM Cost of Living Index: 92.1
Livability Score: 83
This beautiful Cumberland River city is filled with an energy that seniors grow to love. From historical attractions to the artsy vibe, a tempting food scene, and beautiful rivers and trails, this city has got it all. Living expenses in the city are 7.9% lower than the national average, which means retirees will be able to enjoy Clarksville without being overly concerned about the small COLA raise.
12. Lindale, Texas
Insider Monkey Score: 12
IM Cost of Living Index: 89.6
Livability Score: 80
One of the best cities for retirees living on their limited Social Security income is the Texas City of Lindale. Promising a calendar full of events and bustling with small-town Texas charm, everyone who comes to visit Lindale falls in love with it. Retirees in Lindale, Texas, can enjoy outdoor activities at Faulkner Park, play golf at Garden Valley Golf Resort or Hideaway Lake Club, relax at Kinzie Community Center & Pool, explore local history at the Whisenhunt-Kinzie House, and much more.
11. Vestavia Hills, Alabama
Insider Monkey Score: 13
IM Cost of Living Index: 91.0
Livability Score: 83
A lively city, Vestavia Hills allows retirees to stretch their income with a cost of living that is 9% lower than the national average. Vestavia Hills captures Southern hospitality at its best, offering top-tier healthcare facilities, outdoor recreational activities, and abundant cultural attractions. Residents call themselves a “culturally fascinating community”, and indeed, it’s one of the best cities for retirees to live, work, and play.
10. Peoria, Illinois
Insider Monkey Score: 14
IM Cost of Living Index: 82.8
Livability Score: 74
Set on the Illinois River, this striking city has also made it to our list of Most Affordable Places to Retire in the U.S. in 2024. Indeed, living expenses are 17.2% lower than the national average, making it a viable choice for those living on Social Security. Besides its affordability, Peoria appeals to retirees with its abundant recreational activities, beautiful parks including the riverfront, and active senior community.
9. Rochester, New York
Insider Monkey Score: 15
IM Cost of Living Index: 84.3
Livability Score: 76
When seniors think of places to retire cheaply, New York State is the last place to be on their minds. Nevertheless, one place that beats the odds is Rochester, offering the best balance of affordability, culture, and quality healthcare. This thriving city boasts living expenses that are 15.7% lower than the national average, along with an amazing culinary scene, abundant attractions, and countless festivals.
8. Maumelle, Arkansas
Insider Monkey Score: 16
IM Cost of Living Index: 82.9
Livability Score: 75
Home to two lakes, abundant walking and biking trails, and mesmerizing surroundings, Maumelle appeals to both the eyes and a retiree’s budget. Living expenses in the city are 17.1% lower than the national average, making it a budget-friendly choice for those frantic after hearing the latest Social Security COLA update. Additionally, Maumelle’s proximity to Little Rock ensures easy access to quality healthcare, cultural attractions, and various amenities.
7. Norman, Oklahoma
Insider Monkey Score: 16
IM Cost of Living Index: 86.5
Livability Score: 83
Another great retirement spot for those who wish to stretch their retirement income is Norman, Oklahoma. Besides its affordable living expenses, Norman appeals to retirees with its wide range of amenities including the University of Oklahoma’s cultural and recreational facilities. There are beautiful parks to boast as well, like Lake Thunderbird State Park, which offers opportunities for hiking, fishing, and other outdoor pursuits.
6. Abilene, Texas
Insider Monkey Score: 16
IM Cost of Living Index: 80.2
Livability Score: 74
From its walkable downtown cultural district to its friendly community and affordable living costs, Abilene ticks all the boxes when it comes to living a well-rounded retirement. It has many parks and outdoor spaces, abundant cultural attractions, and access to quality healthcare facilities. Additionally, the city’s West Texas charm combined with its vibrant arts scene has given it the distinction of being the Storybook Capital of America®.
5. Bexley, Ohio
Insider Monkey Score: 17
IM Cost of Living Index: 91.2
Livability Score: 92
This captivating city in Ohio makes it to the 6th spot on our list of best cities for retirees after the Social Security COLA update. Loved for its small-town vibe, Bexley is home to beautiful architecture, well-maintained parks, and tree-lined streets. Overall, it’s a safe community to live in, offering affordable housing options as well as an active senior community.
4. Mauldin, South Carolina
Insider Monkey Score: 18
IM Cost of Living Index: 89.2
Livability Score: 85
Ranked as the safest and most affordable city in all of South Carolina, Mauldin is an absolute charmer. Its abundant recreational activities, community vibe, and diverse cultural experiences make it stand out from the crowd. Quality healthcare, local parks and green spaces, and access to amenities further increase its appeal as a retirement destination.
3. Youngstown, Ohio
Insider Monkey Score: 18
IM Cost of Living Index: 84.2
Livability Score: 80
For those surviving on small Social Security checks and are gloomy about the prospects of the SS fund, Youngstown comes out as a savior. Living expenses in this city are 15.8% lower than the national average, and its solid livability score is a testament to the high quality of life that it offers. Besides its budget-friendly living environment, the city also promises a vibrant arts scene, an active community, and abundant recreational opportunities.
2. Brownsville, Texas
Insider Monkey Score: 22
IM Cost of Living Index: 74.9
Livability Score: 78
The state of Texas is a retiree favorite, partly because of its affordability, and partly because it doesn’t tax retirement income. No wonder more than one city has made it to our list of best cities for retirees. Brownsville is a true charmer when it comes to retirement, offering a wide range of amenities, including the beautiful Resaca de la Palma State Park, the Historic Brownsville Museum, and the Gladys Porter Zoo. Additionally, the city’s proximity to the Gulf of Mexico provides access to beaches and recreational opportunities.
1. Oxford, Mississippi
Insider Monkey Score: 27
IM Cost of Living Index: 82.5
Livability Score: 88
For the retirees who are skeptical about retirement in the year 2025 considering their small Social Security checks, Oxford is here to save the day. Promising a captivating blend of an affordable cost of living index and a high livability score, this city is the perfect place to stretch those dollars a bit further. This center of Southern art, culture, and literature is heaven for literary enthusiasts, offering a cosmopolitan ambiance at a fraction of the price. With its rich history, beautiful parks, and welcoming environment, Oxford presents itself as one of the best cities for retirees in 2025.
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Disclosure: None. This article was originally published on Insider Monkey.