2017 Social Security COLA
The 2017 Social Security COLA is 0.3%.
Effective 2017-01-01Source: Cost-of-Living Increase and Other Determinations for 2017 (SSA)Verified 2026-09-01
Who it applies to
The increase applies to people receiving Social Security retirement, survivors or disability benefits under title II of the Social Security Act, and to people receiving Supplemental Security Income under title XVI. Both rise by 0.3 percent. A title II benefit reflects the increase from the December 2016 benefit, which is payable in January 2017; an SSI payment reflects it from the payment made for January 2017. It is a single rate rather than a per-person calculation, so every benefit it applies to rises by the same 0.3 percent and what differs between people is the amount the rate is applied to. The same notice settles other program amounts for 2017 as well, among them the contribution and benefit base, the retirement earnings test exempt amounts and the substantial gainful activity amounts; this page states the cost-of-living increase only, and each of those is a separate figure with its own sentence in the notice.
What changed this year, and why
The Social Security Administration determined a cost-of-living increase of 0.3 percent for 2017. Its notice states the increase as 0.3 percent for benefits under title II of the Social Security Act and for payments under title XVI, so retirement, survivors and disability benefits and Supplemental Security Income payments all rise by the same 0.3 percent. Under title II the increase reaches individuals eligible for December 2016 benefits, which are payable in January 2017. SSI payments increase by 0.3 percent effective for payments made for January 2017. SSA states the increase in its own annual notice in the Federal Register, published in the October before the benefit year begins.
Common questions
- What is the 2017 Social Security COLA?
- It is 0.3 percent. SSA's notice for 2017 states that the cost-of-living increase is 0.3 percent for benefits under title II of the Social Security Act and for payments under title XVI.
- When does the 2017 COLA take effect?
- Under title II it is effective for individuals eligible for December 2016 benefits, which are payable in January 2017. That is why an increase settled in the autumn of 2016 is the increase people see in their 2017 payments.
- Does the 2017 COLA apply to Supplemental Security Income?
- Yes. Federal SSI payments also increase by 0.3 percent, effective for payments made for January 2017. The notice states the same increase for title XVI payments as for title II benefits.
- Who settles the COLA, and where is it published?
- The Social Security Administration does, and it publishes the determination as a notice in the Federal Register titled "Cost-of-Living Increase and Other Determinations for 2017". That notice is the document this page cites, and it is where 0.3 percent is stated in a sentence.
- How is the cost-of-living increase worked out?
- From the Consumer Price Index for Urban Wage Earners and Clerical Workers, which the Bureau of Labor Statistics produces. SSA compares that index for the calendar quarter ending in September with the same quarter of the most recent year in which an increase was determined, and rounds the result. For 2017 that computation gave 0.3 percent.
- Does every beneficiary get the same increase?
- The rate is the same for everyone it applies to: the notice states a single increase of 0.3 percent for benefits under title II and payments under title XVI. What differs between people is the benefit the rate is applied to, not the rate itself.
- What else does the same notice decide?
- The notice that carries the 0.3 percent increase also settles other amounts for 2017, including the contribution and benefit base, the retirement earnings test exempt amounts, the substantial gainful activity amounts and the SSI student earned income exclusion. Each of those is a separate figure with its own sentence in the notice, and this page publishes the cost-of-living increase only.
How the increase is computed, and when there is none
The increase is the percentage rise in the CPI between two quarters: the last computation quarter and the third quarter of the current year. The words to read closely are "if any". If the index has not risen between those two quarters there is no increase, and benefits stay where they are; the law provides no reduction when prices fall. That also explains why the earlier end of the comparison is called the last computation quarter rather than last year's quarter. A quarter becomes the computation quarter by producing an increase, so after a year that produced none the comparison reaches back past it, to the last quarter that did. Nothing is lost that way and nothing is counted twice. For 2017 the comparison produced an increase of 0.3%.
The law states that a cost-of-living increase for benefits is determined based on the percentage increase, if any, in the CPI from the last computation quarter to the third quarter of the current year.
Cost-of-Living Increase and Other Determinations for 2017 (SSA)
Only three months of the CPI decide it
The cost-of-living adjustment for Social Security benefits depends on the Consumer Price Index values from just three months of the year. The law specifies that the CPI for any computation quarter is the arithmetic mean of the index readings for the three months in that quarter. The Administration calculates this average, then compares it to the previous computation quarter's average to see if the index has increased. If it has, benefits go up by that percentage for the following December. If the index has not risen, there is no COLA for that year. For the 2017 COLA, the 0.3 percent increase was determined by comparing the third-quarter averages of the prior computation quarter and the current year.
Section 215(i)(1) of the Act states that the CPI for a cost-of- living computation quarter is the arithmetic mean of this index for the 3 months in that quarter.
Cost-of-Living Increase and Other Determinations for 2017 (SSA)
It starts with December benefits, paid in January
Although the COLA is described as taking effect for a particular month, recipients do not see the larger payment until the following month's check. For 2017, the 0.3 percent cost-of-living increase applies to benefits for December 2016, and those December benefits are the ones paid out in January 2017. This timing has been the standard practice since the COLA system was put in place. The rule applies only to people whose eligibility for benefits - meaning the worker reached age 62, or became disabled, or died before age 62 - occurred before 2017. Anyone who first becomes eligible after 2016 does not receive the 0.3 percent increase; their initial benefit is already calculated using the newer price levels.
In accordance with section 215(i) of the Act, for workers and family members for whom eligibility for benefits (that is, the worker's attainment of age 62, or disability or death before age 62) occurred before 2017, benefits will increase by 0.3 percent beginning with benefits for December 2016, which are payable in January 2017.
Cost-of-Living Increase and Other Determinations for 2017 (SSA)
Working before full retirement age withholds part of the benefit
Beneficiaries who are below full retirement age and continue to work have a portion of their benefits withheld when earnings exceed the annual exempt amount. The withholding rate depends on whether the person reaches NRA during the year. For beneficiaries who attain NRA in the year, the SSA withholds $1 in benefits for every $3 of earnings above the annual exempt amount, and this applies only to earnings in months before the month of NRA attainment. A different, steeper rate applies to beneficiaries under NRA who do not reach NRA during the year. Once a person reaches NRA, there is no longer any earnings limit and no further withholding.
For beneficiaries who attain NRA in the year, we withhold $1 in benefits for every $3 of earnings over the annual exempt amount for months before NRA.
Cost-of-Living Increase and Other Determinations for 2017 (SSA)
The year you reach full retirement age has its own limit
The retirement earnings test has two different exempt amounts for people below full retirement age. The higher exempt amount applies only in the calendar year in which a beneficiary reaches NRA, and only to earnings in the months before the month of NRA attainment. Once the month of NRA is reached, no earnings test applies at all. At all other ages below NRA - years before the NRA year, or years after if one continues to work before NRA - a lower exempt amount applies. Each year the exempt amounts are adjusted using a formula that ties them to changes in the national average wage index. For 2017, both exempt amounts are computed under this formula.
A higher exempt amount applies in the year in which a person attains NRA, but only for earnings in months before such attainment.
Cost-of-Living Increase and Other Determinations for 2017 (SSA)
What earnings count as substantial gainful activity
To qualify for disability benefits under titles II and XVI of the Social Security Act, a person must generally be unable to engage in substantial gainful activity (SGA). The regulations set a monthly earnings threshold above which a person is ordinarily considered to be engaging in SGA, meaning the earnings themselves are taken as evidence that the person is working at a significant level. The SGA amount differs depending on whether the person is statutorily blind. For blind individuals claiming title II benefits, the SGA dollar amount is specified directly in the statute. For non-blind individuals, the SGA amount is set by SSA's own regulations and is adjusted each year in line with changes in the national average wage index. For 2017, both amounts are updated accordingly.
A person who is earning more than a certain monthly amount is ordinarily considered to be engaging in SGA.
Cost-of-Living Increase and Other Determinations for 2017 (SSA)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Cost-of-Living Increase and Other Determinations for 2017 (SSA)
- Cost-of-living increase
The cost-of-living increase is 0.3 percent for benefits under titles II and XVI of the Act.