Inflation continues to impact the predicted cost-of-living adjustment (COLA) for Social Security benefits in 2026, with recent estimates showing an upward trend. The Senior Citizens League, an advocacy group for seniors, has revised its predictions multiple times throughout the year, landing on a new forecast of 2.7% for the upcoming COLA.
This estimate has seen an increase from prior months, with earlier predictions standing at 2.4% in May and 2.3% in March. Each year, the COLA is determined by a measure of inflation that takes into account data from July, August, and September, specifically looking at the Consumer Price Index (CPI). As a result, the final COLA figure is not finalized until the CPI report for September is released in mid-October.
At 2.7%, the expected adjustment would translate to an increase of $54 to the average monthly benefit for retired workers, raising it from $2,008 to $2,062. While this adjustment is an improvement from the previous year’s increase of 2.5%, it is lower than the 3.2% increase seen prior to that. Historically, over the past two decades, the average COLA has remained around 2.6%.
Recent inflation data reveals that consumer prices have risen by 2.9% year-over-year as of August, marking the largest increase since January. The uptick in inflation has been attributed to rising costs in essential goods such as gas, groceries, and airfares, alongside a surge in unemployment aid applications.
As the situation evolves, the official announcement regarding the COLA will follow the release of the September CPI data, which is eagerly anticipated by retirees and those dependent on Social Security benefits. The implications of these adjustments are profound for millions of Americans seeking to navigate the financial challenges posed by rising costs in a fluctuating economic landscape.
