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Social Security benefits could increase by 2.7% in 2026

A recent uptick in inflation has increased unofficial estimates

Updated:

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By:
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Mark Huffman
Reporter

Mark Huffman has covered consumer issues since 2004, with a special focus on protecting and empowering older adults. A former news correspondent for the Associated Press Radio Network, Westwood One, and ConsumerAffairs, Mark brings decades of journalistic experience to RetirementLiving.com. He is passionate about giving consumers a voice and helping them make informed decisions. Mark has also created educational content, including Senior Scam Alert, a video resource designed to help seniors recognize and avoid fraud. He holds a B.A. from the University of Kentucky and lives with his family in Richmond, Virginia.
person counting twenty dollar bills: Photo by Igal Ness on Unsplash

Photo by Igal Ness on Unsplash

Key Insights

  • Projected COLA Range: TSCL’s 2026 projection has risen from an initial 2.5% in December 2024, to 2.4% by May, then to 2.6% in July, and most recently to 2.7% in mid‑August.
  • Lowest in Years? Despite this upward revision, the estimated COLA remains modest compared to recent years and may rank among the smallest increases since 2021.
  • The final COLA will be determined in October, based on third‑quarter CPI‑W data, so projections remain tentative.

Retirees are another month closer to learning what the 2026 Social Security cost-of-living adjustment will be. In its latest update, The Senior Citizens League projects a 2.7% increase in monthly benefits, beginning in January.

TSCL’s predictive model, which incorporates inflation trends, interest rates, and unemployment data, initially forecast a 2.5% COLA in December 2024, equal to the 2025 increase. By mid‑May 2025, as inflation moderated further, the projection slipped slightly to 2.4%, marking the smallest raise since 2021.

However, escalating inflationary pressures and recent economic developments, including the enactment of the “One Big Beautiful Bill” and rising prices, prompted upward revisions over the summer. By July, TSCL had raised its estimate to 2.6%, and by mid‑August, the forecast climbed further to 2.7%. 

If the 2.7% projection holds through the October announcement, retirees would see a modest bump, slightly better than 2025, but still far below the inflation spikes of recent years. TSCL notes that even this adjustment may not fully counteract increased living costs, especially housing and healthcare.

What it means for retirees

A 2.7% COLA would equate to roughly an extra $54 per month for someone currently receiving a $2,000 benefit. But rising Medicare Part B premiums, expected to increase by about $21.50 per month, could significantly erode that gain, especially for lower‑income beneficiaries. Meanwhile, many seniors continue to voice frustration that COLA calculations based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI‑W) fail to reflect inflation as seniors experience it. 

As always, the Social Security Administration’s final COLA announcement in October remains the definitive figure. Until then, TSCL’s evolving projections offer the closest insight into what’s shaping up for 2026—pointing to a modest, albeit slightly improved, cost-of-living adCOLA is announced in October.