The Social Security Administration (SSA) is expected to announce the 2026 Cost-of-Living Adjustment (COLA) on October 15, 2025, provided there’s no delay due to the ongoing federal government shutdown. This annual adjustment helps retirees, survivors, and disabled beneficiaries maintain their purchasing power as living costs rise — particularly for essentials like food, rent, and healthcare.
Early estimates from experts, including economists, the Social Security Board of Trustees, and The Senior Citizens League (TSCL), predict a 2.7% COLA for 2026 — slightly above 2025’s 2.5% increase. Though modest, the rise can make a meaningful difference for millions of Americans who rely on monthly benefits as their main income source.
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What Is COLA?
The Cost-of-Living Adjustment (COLA) was introduced in 1975 to ensure Social Security benefits keep up with inflation. It’s calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) — a measure that tracks price changes across more than 200 everyday items, including:
- Food and groceries
- Housing and utilities
- Medical care and healthcare services
- Transportation costs
Without COLA, seniors and people with disabilities would quickly lose purchasing power, especially during high-inflation years like 2022–2023, when inflation topped 7% annually.
Eligibility Criteria
COLA adjustments automatically apply to all Social Security and Supplemental Security Income (SSI) beneficiaries — there’s no need to apply. The exact increase will depend on each recipient’s current benefit amount.
| Recipient Type | Current Monthly Benefit | Projected 2026 Benefit | Monthly Increase |
|---|---|---|---|
| Single Retiree | $1,500 | $1,540 | +$40 |
| Married Couple | $3,200 | $3,286 | +$86 |
| Disabled Workers / Survivors | Varies | Adjusted proportionally | Varies |
Note: Some retirees may see a slightly smaller net increase if Medicare Part B premiums rise in 2026, since these are typically deducted directly from Social Security payments.
2026 COLA Forecast
Based on CPI-W data up to August 2025, the 2.7% forecast suggests modest but steady improvement in benefit levels.
| Year | COLA | Average Monthly Benefit | Average Annual Increase |
|---|---|---|---|
| 2024 | 3.2% | $1,907 | +$59 |
| 2025 | 2.5% | $2,005 | +$50 |
| 2026 (Projected) | 2.7% | $2,059 | +$54 |
If this projection holds, the average retired worker’s benefit will rise from about $2,005 to $2,059, which equals an additional $648 per year. For seniors facing higher expenses for essentials, this bump offers meaningful financial breathing room.
How the SSA Calculates COLA
The SSA determines the annual COLA by comparing the average CPI-W for July, August, and September of the current year to the same period the year before.
- If CPI-W increases, benefits rise by the same percentage.
- If CPI-W stays flat or decreases, benefits remain unchanged.
The final September inflation data — due in early October 2025 — will finalize the official adjustment before the SSA announcement.
Why a 2.7% Increase Might Not Feel Like Much
While the increase helps offset inflation, many seniors argue it doesn’t fully keep pace with real-world expenses. According to TSCL’s “Loss of Buying Power” report:
- Retirees have lost nearly 40% of their purchasing power since 2000.
- Costs for healthcare, housing, and utilities often outpace general inflation.
Even so, the annual COLA remains crucial in helping Social Security beneficiaries maintain financial stability amid rising living costs.
Impact of a Possible Government Shutdown
If the federal government shutdown continues beyond mid-October, the COLA announcement could be delayed. However, beneficiaries don’t need to worry about missing payments — Social Security is classified as an essential service, meaning checks will continue as usual.
Once government operations resume, the SSA will release the finalized COLA figures, and new payment amounts will take effect in January 2026.
Key Takeaways
- 2026 COLA forecast: 2.7%, slightly above the 2025 increase.
- Average benefit rise: Around $54 more per month, or $648 annually.
- Purpose: Helps Social Security payments keep up with inflation.
- Note: Medicare premium increases may slightly reduce net gains.
FAQs
A: The official announcement is expected on October 15, 2025, unless delayed by a government shutdown.
A: All Social Security and SSI recipients automatically receive the adjustment.
A: Yes, if Part B premiums rise in 2026, they may slightly offset the COLA increase.
