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FINAL: 2023 Social Security Pay Raise



Over the past few months, there has been much discussion on the estimated Cost-of-Living Allowance (COLA) for 2023. We’ve had various estimates ourselves, but without the final CPI-W numbers, it was largely speculation, especially early in the year.

The Verdict

The final COLA, effective Jan 1, 2023, will be 8.7%. This figure applies to Social Security recipients, Veterans Administration (VA) benefit recipients, and federal retirees. You’ll want to do some research on your specific benefit program, as some of these handle the 8.7% increase in a slightly different manner.

Federal Workers

One group of people this COLA does not apply to is federal employees. Instead, the President has issued an alternative pay letter that outlines his plan to issue an average 4.6% pay raise to the entire federal workforce. The details of this will be finalized in an executive order sometime in December.

Things you can do today

While I’m sure you’re excited about the prospects of an 8.7% raise, I don’t want you to get too excited. Let’s not forget, the reason the COLA is 8.7% is because of rampant inflation that has plagued the U.S., and most of the world for the past two years.

Before spending your future pay raise, maybe it’s time to think about ways to shave some money off of your monthly budget in preparation for more inflation. Just be cautious… because no one is exactly sure what to expect in 2023.


  • D.C. Poc

    D.C. joined the Marine Corps right out of high school. When he left active duty after 5 years of service, he quickly earned a bachelors degree and an MBA. He got his first private sector job at a modest salary and quickly worked his way up through promotions. Once he started making decent money ($38k at the time), he quickly realized he needed to learn how to save for his future. After nearly ten years of research and application, he wants to share his knowledge and financial best practices so more people can become Wealthy Idiots!


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