Social Security benefits could rise by about $73 a month on average

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The average Social Security retirement benefit is $2,088 a month, and a 3.5% increase would lift those payments by about $73. The average spousal benefit is $987 a month, which would rise by roughly $35 under the same 3.5% COLA.

Still, the exact amount each beneficiary receives depends on a number of factors. People who already collect more than the $2,088 average would see a larger-than-average boost, while those below that level could get less than expected, particularly if the COLA comes in under 3.5%.

Beneficiaries on Medicare also need to account for higher Part B premiums in the coming year, which can reduce some of the gain from the COLA. Because those premiums are usually deducted directly from Social Security payments, the increase that actually reaches your bank account may be smaller than the headline figures suggest, even for someone receiving the average benefit.

What to do if your Social Security COLA falls short

After the Social Security Administration announces the next COLA, you can add that percentage to your current check to estimate the increase you might see. From there, subtract your expected benefit from your average monthly expenses to see how much you will still need to cover yourself.

Use the final weeks of the year to build a plan for making up the difference. That could mean leaning more on savings, cutting expenses, or exploring part-time work or other government assistance if you are having trouble getting by.

The Social Security Administration will also send a personalized COLA notice in early December with your exact benefit for the following year, including any Medicare Part B premium withholding if you are enrolled. Review that notice carefully and make any needed changes so your budget is ready at the start of the new year.