The Social Security 2026 COLA Projection Keeps Climbing. Here's Why That's Bad News for Retirees.

Key Points

• The Social Security Administration will announce the 2026 COLA in mid-October.

• Based on inflation data so far, it's likely to land at around 2.7%.

• However, Social Security is becoming even less reliable for many retirees.

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

In just under a month, the Social Security Administration will announce the latest cost-of-living adjustment (COLA) for 2026. But you don't necessarily need to wait that long to get an idea of what your next raise might look like.

Nonpartisan advocacy group The Senior Citizens League has been publishing monthly forecasts for the 2026 COLA based on inflation data throughout the year. The estimated COLA has increased nearly every month since January, which may seem like a good thing on the surface. Here's why it could spell trouble for retirees.

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Expect a larger COLA in 2026

According to The Senior Citizens League's most recent estimate released in mid-September, next year's adjustment will likely land at 2.7%. This is based on the latest Consumer Price Index report from the Bureau of Labor Statistics, which revealed that inflation has surged by 2.9% between August 2024 and August 2025.

A 2.7% COLA is just slightly higher than the 2.5% adjustment beneficiaries received this year, and it's also steadily climbed from the 2.1% prediction back in January.

Source: The Senior Citizens League. Table by author.

Realistically, the difference between a 2.1% and 2.7% COLA won't be that significant for most people. The average retired worker collects just over $2,000 per month in Social Security benefits, as of August 2025. A 2.1% raise would amount to around $42 per month, while a 2.7% raise adds up to $54 per month.

The downside to larger checks

Many retirees are stretched thin financially right now, so any COLA at all is still helpful. That said, the drawback to a larger adjustment is that it indicates inflation is higher than previously anticipated.

When The Senior Citizens League made its initial forecast in January that the COLA would be 2.1%, it was under the assumption that inflation would continue to cool throughout the year. But economic factors like new tariff policies have resulted in higher prices yet again.

A report from the Yale Budget Lab found that, as of June, core goods prices increased by 1.9% from pre-2025 levels. The analysis also revealed that around 61% to 80% of the 2025 tariffs on core goods prices were passed through to consumers.

Social Security's cost-of-living problem didn't start in 2025, however. Between 2010 and 2024, benefits lost around 20% of their purchasing power, The Senior Citizens League found. So if it feels like Social Security isn't going as far as it used to, you're not wrong. Between rising inflation, tariffs, and COLAs consistently struggling to keep up over time, it's becoming more and more difficult to rely on Social Security in retirement.

What can you do to protect your retirement?

If you're not already taking steps to find other sources of income or reduce your dependence on Social Security, now may be the time to start. Inflation could continue to increase later this year and into 2026, and there's a chance the COLA may be even less reliable in helping benefits maintain buying power.

Around 85% of retirees have made lifestyle changes due to rising inflation, according to a 2024 survey by The Motley Fool. Some of the most common adjustments include cutting back on essential and non-essential spending, delaying major purchases, and going back to work.

It can be tough to reduce your spending if you're already stretching every penny, and not everyone can bring in another income source. This puts many retirees in a tough spot, but if nothing else, being realistic about how far the COLA will go can help you budget accordingly heading into 2026.

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