Anticipated Amount of Social Security's 2026 Cost-of-Living Adjustment (COLA) and Expected Increase in Benefits

Anticipated Amount of Social Security's 2026 Cost-of-Living Adjustment (COLA) and Expected Increase in Benefits

In 2026, Social Security beneficiaries can anticipate a boost in their monthly payouts, according to the latest forecast by The Senior Citizens League. The average payout for survivor beneficiaries is expected to climb by approximately $42.51 per month, reaching around $1,617, due to a 2.7% cost-of-living adjustment (COLA). For retired worker beneficiaries, this adjustment would add approximately $54.18 per month to their checks, increasing expected annual payouts to over $24,700.

This projected increase in benefits comes as the 2026 COLA estimates narrow, suggesting a potential increase in benefits. The 2.7% COLA in 2026 would be a significant step towards preserving purchasing power amidst inflation for retirees. Over the last 24 years, 80% to 90% of retirees surveyed by Gallup have noted Social Security income as a necessity.

The buying power of a Social Security dollar has declined by 20% since 2010, according to a TSCL analysis published in July 2024. This decline highlights the importance of the COLA, which is a tool designed to combat inflation and adjust benefits to account for rising prices.

Retirees who are dually enrolled in Social Security and traditional Medicare will have their Part B premium automatically deducted from their Social Security benefit each month. However, the Part B premium for Medicare, responsible for outpatient services, is forecast to increase by 11.5% to $206.20 per month in 2026. The highest increase in the Part B premium since 2022 is bound to eat up some, or all, of the projected 2.7% COLA retirees are expected to receive in 2026.

Since 1975, Social Security's COLA calculation has used CPI-W readings from July, August, and September (Q3) only. Prior to 1975, cost-of-living adjustments were assigned by special sessions of Congress. The average worker with disabilities can expect a 2.7% COLA to increase their payout by approximately $42.72 per month to about $1,625.

Independent Social Security and Medicare policy analyst Mary Johnson has kept her 2026 COLA estimate at 2.7%. An important silver lining will be absent for a third straight year for most aged beneficiaries in 2026, as no annual increase in benefits was granted in 2020, 2021, or 2022 due to a technicality in the COLA calculation.

From 2022 through 2025, COLAs clocked in at 5.9%, 8.7%, 3.2%, and 2.5%, respectively. The 8.7% COLA in 2023 marked the largest on a percentage basis in 41 years and the biggest year-over-year nominal-dollar increase in the program's history.

In July 2023, retired workers received an average Social Security check of $2,006.69. As the cost of living continues to rise, the 2.7% COLA in 2026 will provide some relief for retirees, helping them maintain their standard of living.

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