Millions of Americans who rely on Social Security could see a modest increase in their monthly benefits in 2026, as experts forecast a cost-of-living adjustment (COLA) of 2.7% to 2.8%. The Social Security Administration (SSA) is scheduled to officially announce the adjustment on October 15, 2025, following the release of September’s inflation data from the Bureau of Labor Statistics.
The COLA is an annual adjustment designed to help retirees and other beneficiaries keep pace with rising living costs. Nearly 68 million Americans currently receive monthly Social Security benefits, making the adjustment a critical factor in household budgets across the country. According to the Senior Citizens League (TSCL), a 2.7% increase would raise the average monthly benefit from $2,008 to about $2,062. Independent policy analyst Mary Johnson predicts a slightly higher 2.8% increase, which would boost average payments by approximately $56 per month.
While any increase is welcomed, experts note that even the projected rise falls short of the 2.9% inflation rate recorded between August 2024 and August 2025. “While a higher COLA would be welcome because their monthly benefits will increase, many will be disappointed,” said TSCL executive director Shannon Benton. “Our research shows that many seniors believe the COLA does not adequately capture the inflation they experience.”
The Social Security COLA has been a staple of the program since the mid-1970s, designed to adjust benefits annually in line with changes in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The SSA calculates the adjustment based on the percentage increase in the CPI-W from the third quarter of the previous year to the third quarter of the current year. This method aims to reflect the rising cost of goods and services commonly purchased by seniors.
For retirees, even small increases in benefits can make a noticeable difference, especially as inflation continues to affect essentials such as groceries, utilities, and healthcare. A $54 or $56 monthly boost may not fully offset recent price increases, but it can provide some relief to households relying on Social Security as a primary source of income.
“The COLA process is intended to protect retirees from losing purchasing power over time,” said Johnson. “However, there is often a lag between the rise in costs and the increase in benefits. Seniors have told us they feel the adjustments are too small to cover real-world expenses, especially when inflation is higher than the increase in benefits.”
Social Security is a lifeline for many Americans, providing retirement, disability, and survivor benefits. The program has long relied on the COLA to ensure that payments remain meaningful, but experts have increasingly raised concerns about whether the adjustments accurately reflect the true costs faced by older Americans.
In 2025, the SSA awarded a 2.5% COLA, one of the lowest increases on record. With inflation slightly higher than that, beneficiaries may once again find that the adjustment does not fully compensate for rising costs. TSCL research shows that many seniors feel the annual increase is outpaced by the actual expenses they encounter, particularly for healthcare, which accounts for a large portion of their budgets.
Beyond the annual COLA, Social Security recipients face other challenges, including rising prescription drug costs, housing expenses, and long-term care. Advocates argue that while small COLA increases provide some relief, broader measures may be needed to ensure seniors can maintain a stable standard of living.
The SSA has maintained that the COLA calculation is formula-driven and based strictly on inflation data, leaving little room for subjective adjustments. “The increase is determined by law and reflects the changes in the CPI-W over the previous year,” the agency said in a statement. “The goal is to provide beneficiaries with protection against inflation, and the annual announcement will reflect the most current data available.”
Policy analysts also point out that Social Security adjustments affect not only retirees but also disabled beneficiaries, survivors of deceased workers, and other vulnerable groups who depend on these payments. For these households, even a modest increase can have a meaningful impact on their ability to cover essential living costs.
Experts recommend that beneficiaries plan ahead and consider how the anticipated increase may affect their household budgets. “Even though the increase may be smaller than some expect, it is important to account for it in financial planning,” Johnson said. “Many retirees rely on Social Security as a stable source of income, and any increase can help manage monthly expenses.”
As the SSA prepares to announce the official 2026 COLA on October 15, attention will turn to how the increase compares to actual inflation experienced by seniors. If the projected 2.7% to 2.8% rise is confirmed, the adjustment will provide a slight improvement in monthly income, though many beneficiaries may still feel the pinch of rising prices.
For Americans relying on Social Security, the annual COLA serves as both a reassurance and a reminder of the ongoing economic pressures facing retirees. While the program continues to provide essential support, ongoing discussions about adequacy, inflation adjustments, and the broader financial challenges facing seniors are likely to continue in the months and years ahead.
In the meantime, retirees and other beneficiaries can expect their 2026 checks to reflect the new COLA, helping them manage everyday expenses and plan for the year ahead. The official announcement on October 15 will provide clarity on the exact percentage increase and its impact on household budgets across the country.en August 2024 and August 2025, leaving some retirees concerned about the gap.