The 2020 COLA raised SSDI payments by 1.6 percent

In December 2019, the Social Security Administration announced that SSDI payments would increase by 1.6 percent starting January 2020. This was the annual cost of living adjustment, or COLA, meant to help benefits keep pace with inflation.

The 1.6 percent increase was smaller than the previous year's 2.8 percent raise. It reflected slower inflation in 2019 compared to 2018. If you received SSDI in January 2020, your payment went up automatically — you did not need to do anything or contact Social Security.

The exact dollar amount of your increase depended on what you were receiving before the adjustment. Someone getting $1,200 per month would have received about $19 more per month. Someone getting $800 per month would have received about $13 more per month.

Key Takeaways

  • The 2020 COLA of 1.6 percent was calculated based on inflation data from the third quarter of 2019.
  • The increase took effect automatically in January 2020 for all SSDI recipients — no action was required on your part.
  • Your new payment amount appeared in your January 2020 direct deposit or check without advance notice from Social Security.
  • COLA adjustments happen every year in January and are based on inflation measured by the Consumer Price Index.

How Social Security calculated the 2020 increase

The Social Security Administration uses the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) to measure inflation. They compare the average CPI-W for July, August, and September of one year to the same three months of the previous year. For 2020, that comparison showed inflation had grown by 1.6 percent.

This method has been in place since 1975. It means the COLA is determined by actual inflation data, not by a fixed percentage or a decision made by Congress. If inflation is zero or negative, the COLA can be zero — there is no automatic raise that year.

The announcement of the COLA amount happens in October, before the new year begins. This gives Social Security time to reprogram their systems and gives recipients time to plan for the new payment amount.

Why 2020's increase was smaller than 2019's

The 2019 COLA was 2.8 percent because inflation had been higher in 2018. The 2020 COLA dropped to 1.6 percent because inflation slowed in 2019. This happens regularly — COLA amounts rise and fall depending on what inflation does that year.

Inflation is not the same every year. It depends on prices for food, energy, housing, and other goods and services. When prices rise faster, the COLA is larger. When prices rise more slowly, the COLA is smaller. In 2019, prices rose more slowly than they had in 2018, so the 2020 adjustment reflected that slower pace.

What the 2020 increase meant for your budget

For someone receiving $1,200 per month in SSDI, the 2020 increase of 1.6 percent added about $19 per month, or roughly $228 per year. For someone receiving $800 per month, it added about $13 per month, or roughly $152 per year.

These amounts were modest, but they were meant to help offset the rising cost of rent, food, utilities, and medical care. Without the COLA, the purchasing power of your SSDI check would have declined each year as prices rose.

If you were receiving Supplemental Security Income (SSI) in addition to SSDI, you received a separate COLA adjustment for your SSI payment. The SSI COLA was also 1.6 percent in 2020, though SSI and SSDI are different programs with different payment amounts.

How to find out what your 2020 payment was

Your new payment amount appeared in your January 2020 direct deposit or mailed check. Social Security did not send a separate notice announcing the increase — the new amount straightforward showed up in your account or mailbox.

If you wanted to confirm the amount, you could create a my Social Security account at ssa.gov and log in to see your payment history and current payment amount. You could also call Social Security at 1-800-772-1213 to ask what your payment was before and after the adjustment.

Your Social Security Statement, which you can view online through your my Social Security account, also shows your payment history month by month, so you could see exactly when the increase took effect.

COLA adjustments in the years before and after 2020

The 2020 COLA of 1.6 percent sits in the middle of recent history. The 2019 COLA was 2.8 percent, and the 2018 COLA was 2.0 percent. Going back further, 2017 saw a 0.3 percent increase, and 2016 had no COLA at all — inflation was too low.

In 2021, the COLA rose to 1.3 percent. In 2022, it jumped to 5.9 percent because inflation had accelerated. These swings show why the COLA is tied to actual inflation data rather than a fixed amount — it responds to what is actually happening in the economy.

If you were receiving SSDI before 2020, you saw your payments adjust each January based on that year's inflation. If you started receiving SSDI after 2020, your first payment was already at the rate that included all previous COLAs, so you did not receive a separate 2020 adjustment.

Frequently Asked Questions

Did I have to do anything to get the 2020 COLA increase?

No. The increase was automatic. Social Security applied it to all SSDI recipients in January 2020 without requiring any action from you. Your new payment amount straightforward appeared in your account or check.

Why was the 2020 increase only 1.6 percent?

The COLA is based on inflation measured by the Consumer Price Index. Inflation in 2019 was slower than in 2018, so the 2020 adjustment was smaller. COLA amounts change every year depending on how fast prices are rising.

Can I find out what my payment was before the 2020 increase?

Yes. You can log into your my Social Security account at ssa.gov to see your payment history month by month. You can also call Social Security at 1-800-772-1213 to ask about your payment amounts before and after the adjustment.

Does the COLA explore to SSI as well as SSDI?

Yes, but SSI and SSDI are separate programs with different payment amounts. If you received both in 2020, you got a 1.6 percent increase on each one. The increases were applied separately to each program.

Will I get a COLA increase every year?

Most years, yes — but not always. The COLA is based on inflation. If inflation is zero or negative, there is no COLA that year. This happened in 2016. In most other years since 1975, there has been a COLA, though the amount varies.