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What is Cost of Living Adjustment?

Definition of Cost of Living Adjustment

The Social Security Administration makes increases for general disability benefits based on the Consumer price index cost of living adjustments or COLA. The Social Security Administration has used this method of increasing payments since 1975, prior to this time the adjustments were made by legislative decision. If there is a decline in the Consumer Price Index, such as in 2010, the Social Security Administration may decide not to pay a COLA adjustment.

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