How Much Social Security Could Go Up in 2026? New COLA Projection!

Race Day Live By now, all seniors on Social Security should have received their first payments for 2025. With the new 2.5% cost-of-living adjustment (COLA), the average monthly benefit has increased to $1,976.

That’s about $49 more than what beneficiaries received in December 2024.

While any increase is better than none, it may not be enough for retirees struggling with rising costs.

According to the Senior Citizens League (TSCL), Social Security has lost 20% of its buying power since 2010. This means that even with adjustments, benefits may not fully keep up with inflation.

With financial pressures continuing, many retirees are already looking ahead to the 2026 COLA, hoping it will bring some relief. While the official numbers won’t be available for months, early estimates suggest a lower adjustment next year.

How Is the COLA Calculated?

The Social Security Administration (SSA) bases COLA increases on inflation data from the third quarter (July, August, and September) of each year.

The main metric used is the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

However, some argue that CPI-W does not accurately reflect retirees’ expenses. The Consumer Price Index for the Elderly (CPI-E), which tracks senior spending habits more closely, often shows a higher inflation rate. Despite this, CPI-W remains the official measure for COLA calculations.

Inflation Is Slowing, Leading to a Lower COLA for 2026

Inflation has cooled compared to early 2024, with both CPI-W and CPI-E showing slower growth.

While lower inflation is good for overall prices, it also means a smaller COLA increase. If this trend continues, retirees should expect a more modest benefit increase in 2026.

2026 COLA Expected to Be the Lowest Since 2021

The official COLA for 2026 won’t be announced until October 15, 2025, when the September inflation report is released. However, TSCL has already predicted that the 2026 COLA will be around 2.1%.

If this estimate holds, the average Social Security benefit would rise from $1,976 to about $2,017 per month.

That’s an increase of just $41 per month or about $492 per year. While this is still an increase, it is smaller than the adjustments seen in recent years.

Read More:

• Survey Finds Most Americans Support Tax Increases to Protect Social Security!
• Social Security COLA 2026 Predicted at 2.1%, Raising Concerns for Retirees!

Will the Estimate Change?

It’s possible that the 2026 COLA forecast could change as inflation trends shift. In April 2024, TSCL’s estimate for the 2025 COLA was only 0.1% off the final figure, so their projections tend to be accurate.

However, if inflation rises again in late 2025, the COLA could be adjusted upward.

Other Social Security Changes to Watch in 2025

While COLA adjustments are a major focus for Social Security recipients, other changes could impact benefits as well. Here are two key developments:

1. Social Security Fairness Act – In his final days in office, President Biden passed this law to increase benefits for 2.8 million government workers and their family members. This could mean higher payments for those affected.
2. Eliminating Social Security Benefit Taxes? – Former President Trump has proposed eliminating Social Security benefit taxes. According to a Tax Policy Center analysis, this would lower taxes for U.S. households by an average of $550 per year. However, it’s uncertain whether this plan will gain enough support in Congress.

Planning for 2026

As we move further into 2025, Social Security recipients should keep an eye on inflation trends and policy changes.

While the 2026 COLA is expected to be lower than in previous years, knowing the estimated increase can help retirees plan their budgets.

Stay informed, and be prepared for possible adjustments in benefits and tax policies as the year progresses.

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