October 14, 2020

Social Security Disability, Veterans Disability Beneficiaries to Receive 1.3% Cost of Living Increase in 2021

Cost-of-living adjustment will benefit individuals with disabilities during pandemic, according to Allsup

Belleville, Illinois — October 14, 2020 Individuals who receive Social Security Disability Insurance (SSDI) benefits and veterans disability benefits will see a 1.3% increase in their monthly benefit in 2021, according to Allsup, a nationwide provider of SSDI, return to work, veterans disability appeal and Medicare plan selection services. This increase is a result of the annual cost-of-living adjustment (COLA), which is an automatic calculation applied to Social Security benefits. The increase will take effect in January 2021.

“Individuals and former workers depend on these benefits as a financial backstop following a severe disability, and it’s vital that the monthly income keeps pace with inflation,” said Steve Perrigo, Vice President of Allsup. “The annual COLA increase is one of those critical features of Social Security disability benefits that former workers should be aware of when deciding to apply for SSDI.”

Approximately 156 million U.S. workers are insured for disability insurance through the SSDI program and pay for this coverage, along with their employers, through their FICA payroll taxes.

“Every uptick in monthly income can make a difference in how people with disabilities manage medical and other living expenses,” Perrigo added. “These benefits also provide the gateway for those wanting to return to work after reaching medical recovery or stability.

The average SSDI benefit will increase to $1,277 per month from $1,261 per month, which is an increase of $16 per month (or $192 annually), according to the Social Security Administration. The average benefit for a worker with a disability, spouse and one or more children will increase to $2,224 per month from $2,195 per month, which is an increase of $29 per month (or $348 annually).

The COLA is calculated using third-quarter results from data reported by the U.S. Bureau of Labor Statistics’ Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Typically, a comparison of the current year to the previous year determines if there is an increase. The COLA also is applied to veterans disability compensation and pension benefits, which is managed by the U.S. Department of Veterans Affairs, and to Supplemental Security Income (SSI) benefits. Find more information online.

SSDI is a payroll tax-funded, federal insurance program. A portion of FICA taxes that workers pay is set aside for SSDI, as well as Social Security retirement and Medicare. SSDI benefits provide monthly income and access to Medicare after a 24-month waiting period.

Benefits Help From Allsup

  • Medicare: Beneficiaries have from Oct. 15 to Dec. 7, 2020, to make Medicare plan changes for their 2021 healthcare coverage. To speak to an Allsup Medicare specialist, call (866) 521-7655.
  • Veterans: Those who need assistance can visit our web page and get help with planning a VA disability appeal by calling (888) 372-1190.
  • Return to work: If you receive SSDI and are considering returning to work, learn more by contacting Allsup Employment Services at (866) 540-5105.
  • SSDI: Get started with empower by Allsup® and take our Free SSDI Assessment to learn your likelihood of being eligible for SSDI benefits.


Allsup and its subsidiaries provide nationwide Social Security disability, veterans disability appeal, return to work, and healthcare benefits services for individuals, their employers and insurance carriers. Allsup professionals deliver specialized services supporting people with disabilities and seniors so they may lead lives that are as financially secure and as healthy as possible. Founded in 1984, the company is based in Belleville, Illinois, near St. Louis. Learn more at TrueHelp.com and @Allsup or download a free PDF of Applying for Social Security Disability Insurance: Getting It Right The First Time.

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