2024 Social Security COLA set at 3.2%

Last month, the Social Security Administration announced that Social Security benefits will increase by 3.2% in 2024. This cost-of-living adjustment (COLA) will affect over 71 million Social Security beneficiaries.

This COLA is significantly smaller than last year’s Social Security COLA, which was 8.7%. Annual Social Security COLAs are intended to counter the increase in consumer prices brought about by inflation, and this year’s lower Social Security COLA is a sign of slowing, but persistent inflation on the prices of consumer goods.

The average Social Security retirement beneficiary will see, on average, a $50 monthly increase, but the average increase for retirees in Texas will likely be smaller. About 96% of public school employees do not pay into the Social Security system, and therefore many of these employees either do not receive Social Security benefits or those benefits are significantly reduced by the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO).

The WEP reduces the Social Security retirement, disability, spousal, or survivor benefits of people who worked in jobs in which they did not pay Social Security taxes but are vested in the system from working in a different job in which they did pay Social Security taxes. The GPO reduces the spousal/survivor benefits of people who receive a pension from a job in which they did not pay Social Security taxes by two-thirds of their own monthly public pension annuity. Due to their overall reduced Social Security benefit, most Texas retired educators will have a lower than average overall increase from this Social Security COLA. 

In addition to not reaping the full benefits of this Social Security COLA, retired educators in Texas also do not receive an automatic COLA to their Teacher Retirement System (TRS) pensions. In both the reduction of Social Security benefits and the lack of an automatic pension COLA, Texas retired educators are in the national minority. Texas is one of only 20 states in which educators do not have an automatic pension COLA, and it is one of only 17 states in which the vast majority of retired educators are impacted by the WEP and GPO. Texas and Louisiana are the only two states that fall into both categories. Because of this, retired educators in both states are significantly more affected by the rising costs of living.

Thanks to the advocacy and organizing of Texas AFT Retiree Plus and other organizations, Texas retired educators will receive a slight (and overdue) COLA to their pensions. But because there is still no automatic COLA, retired educators will not be protected from future cost-of-living increases. Multiple pieces of legislation have been proposed to address the unfair nature of the WEP and GPO in Congress, including the The Social Security Fairness Act of 2023 (H.R. 82 and S.597), which is supported by the American Federation of Teachers and has 300 co-sponsors in the U.S. House.
This week it was announced that H.R. 82 will receive a hearing in the House Ways and Means Committee. The hearing is scheduled for Monday, Nov. 20, 2023, at 2 p.m. CT. Members of the public can watch the hearing online. Any person(s) and/or organization(s) wishing to submit written comments for the hearing record can do so here: WMSubmission@mail.house.gov. The committee has details on how to format your comments.