On October 10, the Social Security Administration (SSA) announced that benefits would receive a 2.5% cost-of-living adjustment (COLA) in 2025. And many seniors are no doubt unhappy about this given that the COLA of 2025 is considerably lower than the COLAs arrived in recent years.

But here’s the truth. No matter what COLA Social security beneficiaries will receive in 2025. The sad reality is that any COLA risks failing seniors because of a flaw in how these increases are calculated.

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Social Security COLA are based on the change in the consumer price index for urban employees and office workers (CPI-W) from one year to the next. But the CPI-W fails to adequately capture the costs that Social Security recipients typically face. And so basing COLAs on that is an injustice to seniors.

The Senior Citizens League reports that average Social Security benefits in 2024 are only worth about $0.80 on the dollar compared to 2010. In other words, Social Security recipients have lost about 20% of their power purchase over the past 14 years.

The bad news is that for now, Social Security beneficiaries are stuck with this less than ideal method for calculating COLAs. It will take a change by lawmakers to use a different measure, such as the CPI-E (consumer price index for seniors).

That said, if you’re worried that insufficient Social Security COLAs will destroy your retirement finances, you can get around this by giving yourself a larger monthly benefit to start. Here’s how.

1. Work at least 35 years

The monthly Social Security benefit you’re entitled to in retirement is based on your 35 peak earning years. But if you don’t have a complete 35-year work history, $0 will be counted toward your benefit calculation for each year you don’t have earnings on file. So if you’re nearing the end of your career and are just under 35 years of earning, consider delaying your retirement by a year or two to make up the difference.

2. Make sure your income statement is accurate

The more money you earn during your career, the larger Social Security benefit you qualify for. But if the SSA has inaccurate wage data for you, it could result in a lower benefit than you should receive.

To avoid this, create an account on the SSA website and check your income statement every year. If you notice that your income is underreported at any time, contact the SSA and work with the agency to update this data.

3. Delay your claim for benefits until age 70

You are entitled to your full monthly Social Security benefit based on your individual earnings history at full retirement age. If you were born in 1960 or later, the full retirement age is 67.

But if you delay your Social Security application beyond that time, for each month you do, your monthly retirement benefit increases by 2/3 of 1%. In other words, this benefit increases by 8% per year and you can accumulate delayed retirement credits until age 70. So, with a full retirement age of 67, it is possible to increase your monthly benefit by up to 24% – for life.

It is unfortunate that Social Security’s annual COLAs fail to help seniors meet their expenses. But if you start your retirement with a higher monthly benefit, you’ll be in an even stronger position to manage your living expenses over the years.