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Social Security Checks Are Much Bigger in January. Learn About the Record Hike

The cost-of-living adjustment for Social Security this year is the largest in four decades.

Three 100 dollar bills
Social Security benefits are tied to inflation, which soared in early 2022.
Sarah Tew/CNET

Now that we're fully into 2023, Social Security recipients are starting to see their first benefit checks of the new year, and they might be pleasantly surprised. Monthly payments are rising by 8.7% due to a cost-of-living adjustment, or COLA.

The increase in Social Security benefits marks the largest hike since the all-time record of 11.2%, set back in 1981.

"A COLA of 8.7% is extremely rare and would be the highest ever received by most Social Security beneficiaries alive today," Senior Citizens League policy analyst Mary Johnson said in a statement earlier in 2022. 

In fact, the COLA has only risen above 7% five times since it was introduced in 1975. The 2022 COLA, in comparison, was only 5.9%.

The adjustment is determined annually by shifts in the Consumer Price Index, which charts year-over-year price fluctuations for goods and services. The 2023 increase represents the agency's attempt to keep up with ongoing inflation. 

Read on to learn all about 2023 Social Security benefits, including how much more you'll be getting and when the increase will appear in checks.

For more on Social Security, learn how to access your payments online and how benefits are calculated

What is COLA?

Since 1975, Social Security benefits have been modified annually based on fluctuations in inflation, as determined by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This cost of living adjustment, or COLA, is determined by comparing the average CPI-W in the months of the third quarter of the current year to the same timeframe in the year prior.

"The COLA increase is a valuable feature that keeps retirees from truly being tied to a 'fixed income' when managing expenses," Rob Williams, managing director of financial planning at Charles Schwab, told CNET. 

The CPI-W was 8.5% in July and dipped down to 8.3% in August before hitting 8.2% in September.

How much are Social Security benefits increasing in 2023?

The 2023 COLA is 8.7%. Here's how that breaks down for different groups, according to the Social Security Administration (PDF).

Category

Average monthly increase

Average 2023 check

Retiree

$146

$1,827

Worker with disabilities

$119

$1,483

Senior couple, both receiving benefits

$238

$2,972

Widow(er)

$137

$1,704

Widow(er) with two children

$282

$3,520

Beneficiaries should have received letters detailing their specific benefit rate for 2023. If you missed the letter, you can still verify your increase via the My Social Security website.

When will I see the increase in my Social Security check?

The COLA went into effect with December 2022 benefits, which arrive first in checks delivered in January 2023. 

Social Security payments are made on Wednesdays, following a rollout schedule based on the beneficiary's birth date. So if you were born from the 1st through the 10th of the month, your benefits are paid on the second Wednesday of the month.

If your birthday falls between the 11th and 20th of the month, your checks are paid on the third Wednesday, and you'll see your first COLA increase in your Jan. 18 check.

Those born between the 21st and the end of the month receive benefits on the fourth Wednesday, which, in 2023, is Jan. 25.

Read on: Is the 2023 COLA for Social Security Too Small?