This Is the Average 2027 Social Security Benefit If the COLA Predictions Pan Out

Source Motley_fool

Key Points

  • Social Security benefits are expected to increase in 2027.

  • Experts are predicting a benefit increase of 3.5%

  • The average Social Security benefit will change with this adjustment.

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

Social Security beneficiaries are expected to get a cost-of-living adjustment in 2027. This increase will take effect with the first checks of the new year and aims to help retirees keep pace with inflation.

The official COLA announcement is coming on Oct. 14, so retirees will know exactly how much extra money they can expect to collect at that time.

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Some experts have already estimated how large the COLA will be, though, and it can be helpful to look at how the average Social Security check will change once it is applied.

Adult typing on laptop.

Image source: Getty Images.

Here's what the average Social Security check will look like after the COLA is applied

The Social Security COLA is applied to your primary insurance amount, and that number is adjusted up or down based on when you claimed your benefits and whether any early-filing penalties or delayed-retirement credits apply based on your claiming age.

However, you can get a fairly good estimate of how much the typical benefit will be after the Social Security cost-of-living adjustment (COLA) by adding the expected increase to the current average benefit. The Senior Citizens League has predicted a 3.5% bump in monthly Social Security checks in 2027.

Since the average Social Security retirement benefit in 2026 is $2,033.27 per month, applying this 3.5% COLA would increase the average benefit in 2027 to $2,104.43. That's around a $71.16 monthly increase, or $853.92 more per year than the average Social Security benefit collected in 2026.

Will your raise be enough to help you cover rising costs?

The benefit increase is expected to be larger in 2027 than what retirees received in 2026. In 2026, Social Security beneficiaries saw their benefits go up by 2.8%. The typical retired worker saw an increase of about $57 per month due to that change.

While the $71.16 bump the typical retiree will see in 2027 is more generous, many retirees won't get to keep the full increase, largely because of rising Medicare premiums. Medicare Part B is expected to cost about $6.60 more per month in 2027 for those paying the standard premium. This means that the average $71.16 raise would result in around $64.56 more actually being deposited for the many seniors whose Medicare premiums are withdrawn directly from their Social Security.

This Medicare premium increase is lower than the 2026 premium change, as Medicare Part B costs rose by $17.90 this year compared with 2025. Still, with many retirees already struggling with their daily expenses, losing any portion of their COLA isn't great news.

In addition, COLAs have historically not done a great job of keeping pace with inflation, despite being designed to do so. The Senior Citizens League estimates that benefits have actually lost around 13.7% of buying power since 2016. The loss of buying power stems from the fact that COLAs are calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which is an imperfect measure of the inflation older Americans are actually experiencing.

The larger COLA in 2027 also means inflation is still very high, which isn't great news for retirees who rely on other income that isn't automatically adjusted for rising prices.

The new 2027 Social Security benefit isn't enough to live on

Regardless of whether the 2027 COLA keeps pace with inflation, a new average monthly benefit of around $2,104.43 still does not provide enough income for retirees to live on without supplementary funds.

Seniors need additional sources of income beyond Social Security to have a comfortable lifestyle. Hopefully, most retirees already have that in place. For those looking to retire in the future, socking away extra money in retirement plans can help ensure you have the security you deserve.

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

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Disclaimer: For information purposes only. Past performance is not indicative of future results.
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