You Have Less Than 2 Months to Prepare for This Huge Social Security Announcement

Key Points

• Social Security retirees are going to find out some big news in October.

• The Social Security Administration will announce the amount of the 2026 COLA.

• Right now, the early projections suggest seniors are on track for a 2.7% raise.

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

Retirees have a lot to think about right now with recent changes to Social Security, including the impending end of paper checks on Sept. 30, as well as changes to the customer service processes and procedures at local Social Security offices.

Soon, though, one of the biggest days of the year is coming up for Social Security beneficiaries. In fact, retirees have less than two months to prepare for a major announcement that will shape the amount of benefits they are able to collect in 2026.

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Here's what's happening, along with some tips for why retirees need to be ready.

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A huge Social Security announcement is coming soon

Retirees should mark their calendars, as a big announcement is coming in mid-October. Specifically, around Oct. 15, the Social Security Administration is going to officially announce the amount of the 2026 cost-of-living adjustment (COLA).

COLAs are raises seniors get in most years to help them keep pace with inflation. There is a COLA formula built into the benefits program because otherwise Social Security benefits would lose buying power over time. And each year, seniors eagerly await the news of how big their benefits increase is going to be.

The news will be coming out around Oct. 15 because that's when all of the data will be in to determine the COLA based on the established formula. See, COLAs are calculated using third-quarter data from the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

The Social Security Administration looks at year-over-year changes to CPI-W during the third quarter of the year (July, August, and September) and the benefits increase is based on the percentage change in that number.

Seniors will find out exactly how much extra money they will get in their checks next year once the Bureau of Labor Statistics releases the September number. And that happens around Oct. 15, since it takes time to compile and organize the data.

What should retirees do to prepare?

Retirees need to be prepared for this big announcement because it is going to impact their finances next year. Right now, the early projections suggest seniors are on track for a 2.7% raise. That's a slightly larger COLA than retirees got this year, as seniors saw their payments go up by 2.5%.

While getting more money in their check is good news, the higher COLA means that inflation got worse, since that is how the formula works. The raise is directly tied to average price increases measured by a financial index. Higher inflation isn't great for retirees because most have money in retirement plans, which may not retain their buying power when levels of inflation are too high.

If seniors see the buying power of their 401(k) fall, that's not a good thing. It's also not great if they see the buying power of their IRA investments and savings decline due to higher inflation.

Seniors should start preparing for the reality that those higher levels of inflation will persist next year, though, at least if estimates for the COLA pan out. This may mean starting to look at budget cuts sooner rather than later to avoid overspending as prices continue to climb higher.

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