Social Security: October Will Be the Most Important Month of the Year for Retirees. Here's Why.

Key Points

• Most years, Social Security recipients will receive a cost-of-living adjustment.

• The 2026 COLA may be higher than expected, but there's a catch.

• A higher adjustment may not be as beneficial as it seems on the surface.

• The $23,760 Social Security bonus most retirees completely overlook ›

Millions of retirees are stretched thin financially right now, relying heavily on Social Security checks to make ends meet. In fact, just over 60% of beneficiaries say that they couldn't survive if they missed even half of a monthly Social Security payment, according to a 2025 survey from the Nationwide Retirement Institute.

October is one of the most important times of year for those relying on their benefits, as the Social Security Administration (SSA) will announce the upcoming cost-of-living adjustment (COLA). Here's everything you need to know about the future COLA and how it could affect your retirement.

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When will the 2026 COLA be announced?

The COLA is calculated using third-quarter inflation data based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The CPI-W is published monthly by the Bureau of Labor Statistics, and it tracks changes in everyday costs affecting the typical American worker.

To determine the 2026 COLA, the SSA will take an average of the CPI-W values from July, August, and September of this year. It will then compare that figure to the average from the same time period in 2024. If this year's average is higher, the percentage difference will be the COLA for 2026.

September's CPI-W report is expected to be released on Oct. 15, according to the Bureau of Labor Statistics, and the SSA will likely announce next year's COLA shortly after that report is published.

COLA estimates continue to climb

While we won't know the official COLA until mid-October, some experts have already predicted where it may land based on inflation data so far this year.

Nonpartisan advocacy group The Senior Citizens League estimates that the 2026 COLA will be 2.7%, based on the most recent CPI-W data released in August. That's up from its 2.1% estimate in January, and it's steadily climbed month after month.

Data source: The Senior Citizens League.

A higher COLA may seem like a good thing on the surface. However, because the adjustment is directly tied to inflation, a higher COLA indicates that prices have surged this year. For many retirees, the extra money they'll receive from Social Security may not outweigh the higher costs they're facing.

Food costs, for example, have surged by 2.9% between July 2024 and July 2025, according to the USDA, while the average electricity bill increased by 6.7% over the past 12 months. While a 2.7% COLA can help cover those costs, rising inflation will often have a bigger impact on retirees' budgets than a higher Social Security benefit.

What can retirees do right now?

Perhaps the best move you can make when it comes to the COLA is to keep your expectations in check.

A 2025 report from the SSA Board of Trustees revealed that the highest possible COLA for 2026 would likely be 3%. This assumes that inflation continues to surge throughout September, resulting in a higher adjustment.

The average retired worker collects around $2,000 per month in Social Security benefits, as of July 2025. A 2.7% COLA would amount to around $54 per month, while a 3% adjustment would result in a $60 monthly raise. While that extra cash can make a difference, it's wise to keep realistic expectations around just how far that money will go and then budget accordingly.

If you're able, finding other sources of income besides Social Security can also be helpful. That could mean continuing to work while receiving benefits or perhaps generating a small source of passive income to boost your savings. The less you need to depend on your benefits, the more protected you'll be against inflation in 2026 and beyond.

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