In 2023, Social Security beneficiaries saw a record 8.7% boost, the highest increase in four decades.

That same level of increase likely won’t be seen in 2024, however.

Advocacy group The Senior Citizens League estimates recipients will see a 3.1% cost-of-living-adjustment in 2024. The drop has to do with cooling inflation – even if consumers aren’t seeing the relief in their wallets.

Lower inflation rates have not necessarily meant that prices have come down, TSCL said, pointing to a study that shows the oldest adults – especially those ages 85 and older – who retired before 2000, have lost 36 percent of their buying power. These retirees would need an extra $516.70 per month ($6,200 in 2023) to maintain the same level of buying power they had in 2000.

“This study confirms that the prices older consumers are paying simply are not growing as fast as a year ago, but many prices on key items through February 2023 remain stubbornly high,” TSCL said.

Cost-of-living adjustments are determined using third-quarter data – July, August and September – from the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W.

If the figures hold, the 3.1% COLA increase would be the lowest since 2020 when benefits grew only 1.3%. In subsequent years, the coronavirus (COVID-19) pandemic’s impact on inflation lead to higher increases – there was a 5.9% COLA increase in 2021.

The Social Security Administration officially announces the COLA in the Fall.

In 2023, an average of nearly 67 million Americans per month collect Social Security benefits, representing about 30% of the income for U.S. residents aged 65 and older.