WASHINGTON, D.C. — Millions of retirees are counting down to November 15, 2025, when the Social Security Administration (SSA) is expected to announce the official 2026 cost-of-living adjustment (COLA). The yearly update, based on inflation, determines how much seniors’ monthly checks will increase — a crucial safeguard against rising prices.
While the upcoming adjustment won’t be as dramatic as 2022’s record 8.7% hike, analysts say retirees should still expect a modest but meaningful boost of about 2.7% starting January 2026.
What Experts Predict for 2026
According to the Social Security Board of Trustees and the Senior Citizens League (TSCL), the 2026 COLA will likely come in just above this year’s 2.5% rise. That would mean an average monthly benefit increase of $54, or about $648 more per year for the typical retiree.
| Category | 2025 Estimate | 2026 (Projected) | Change |
|---|---|---|---|
| Average Monthly Benefit | $2,005 | $2,059 | +$54 |
| Annual Total | $24,060 | $24,708 | +$648 |
| Percent Increase (COLA) | 2.5% | 2.7% | +0.2% |
“COLA isn’t meant to make people rich,” said Mary Johnson, a senior policy analyst at TSCL. “It’s meant to keep people from falling behind — and even a small bump can make a big difference.”
How the COLA Is Calculated
The SSA determines the annual adjustment using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), compiled by the U.S. Bureau of Labor Statistics. Each fall, officials compare average prices from July, August, and September with the same period from the previous year. If prices rise, benefits rise by the same percentage.
Based on current inflation data through August 2025, a 2.7% increase is the most likely scenario. The final rate will depend on the September CPI report, which should be published in early November.
When the Increase Takes Effect
Once confirmed, the 2026 COLA will take effect January 2026, with retirees seeing the higher payment in that month’s deposit.
The Medicare Factor: Why Some Will See Less
Not all retirees will feel the full benefit. Historically, Medicare Part B premiums rise alongside Social Security increases, trimming the net gain. Analysts from the Kaiser Family Foundation and Medicare.gov expect 2026 premiums to climb by roughly $6–$8 per month.
“The average retiree will probably take home about $40–$45 more a month after Medicare deductions,” said Teresa Ghilarducci, an economist with The New School’s Retirement Equity Lab.
Why COLA Doesn’t Always Match Reality
Even with annual adjustments, seniors have lost nearly 40% of their buying power since 2000, TSCL reports. That’s because the CPI-W measures spending by working-age households, not retirees — meaning it underestimates costs for healthcare, housing, and utilities, which make up a larger share of older Americans’ budgets.
As a result, even small inflation spikes in essentials can outpace COLA’s protective effect.
Shutdown Could Delay the Announcement — But Not Checks
If the federal government shutdown continues into mid-November, the SSA may delay the COLA announcement. However, Social Security benefits are considered mandatory spending, so payments will continue uninterrupted.
An SSA spokesperson reassured beneficiaries that “checks will go out as scheduled,” even if other operations pause. Once government offices reopen, the agency will immediately publish the official COLA.
Smart Moves for Retirees
Financial planners suggest viewing COLA as a cushion, not a bonus. Here’s how experts recommend preparing:
- Budget conservatively: Treat the increase as protection against inflation, not extra spending money.
- Monitor Medicare costs: Premium hikes come directly out of your Social Security check.
- Watch your taxes: A higher benefit may nudge some retirees into taxable income brackets.
- Stay informed: Follow inflation updates on BLS.gov to anticipate future adjustments.
“Think of COLA as a seatbelt,” said Anthony Rivera, a financial planner in Tampa. “It won’t move you forward faster — it just keeps you from sliding backward.”
Why a Smaller COLA Is a Good Sign
While a lower increase might disappoint some, experts say it signals progress. A moderate 2–3% adjustment means inflation is stabilizing after years of turbulence. “Predictability is what retirees really need,” Johnson noted. “It helps them plan and preserve peace of mind.”
