Increase in Social Security Benefits in 2026 Predicted to Include a "Trump Boost" - Learn the Anticipated Amount of Additional Benefits
The 2026 forecast for the Social Security Cost-of-Living Adjustment (COLA) has risen to 2.7%, according to The Senior Citizens League (TSCL) and independent Social Security and Medicare policy analyst Mary Johnson. This potential increase is good news for beneficiaries, but it might not be enough to offset other financial challenges they face.
The Social Security COLA is an annual adjustment aimed at combating inflation. The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which measures inflation for Social Security, is used to determine the COLA. The CPI-W consists of over 200 individually weighted price categories.
If accurate, the average retired-worker beneficiary can expect their monthly payout to climb by $54 next year, while the average worker with disabilities and survivor beneficiary would each see their monthly checks rise by approximately $43.
However, 2026 presents as another mixed bag for retirees. While the COLA increase offers a glimmer of hope, the looming increase in Medicare Part B premiums could consume some or all of the 2026 COLA for many beneficiaries. The Medicare Part B premium is forecasted to increase by 11.5% to $206.20 per month in 2026.
One factor that could influence the 2026 COLA reveal is President Trump's tariff and trade policy. If successful, it could potentially result in a "Trump bump" for beneficiaries. However, one concern with President Trump's tariff policy is that it fails to differentiate between output and input tariffs, potentially raising prices for U.S. manufacturers.
It's important to note that the CPI-W does not properly weight the costs that matter most to retirees, such as shelter and medical care. This means that the buying power of Social Security income has been declining since this century began, with a 20% drop in purchasing power for retired workers based on a TSCL analysis from 2010 to 2024.
Over the last four years, Social Security COLAs have been above average, with rates of 5.9%, 8.7%, 3.2%, and 2.5% respectively. The average annual COLA since 2010 is 2.3%.
In conclusion, while the 2026 COLA forecast offers a glimmer of hope for retirees, it's essential to consider the other financial challenges they face, such as the potential increase in Medicare Part B premiums and the ongoing issue of the CPI-W not properly weighting costs that matter most to retirees.
