Millions of retirees may see a slightly bigger cost‑of‑living adjustment next year, but some households could still struggle to keep pace with rising health costs.
The federal government’s preliminary reading, released after June inflation data, suggests the 2026 Social Security COLA will land between 2.6 % and 2.7 %. That is a hair above the 2.5 % bump beneficiaries received in January 2025 and reflects persistent price pressure measured by the CPI‑W index.
Latest inflation numbers push the official 2026 COLA estimate slightly higher than this year’s increase
The annual COLA is calculated by comparing third‑quarter CPI‑W figures with the same period a year earlier. Recent upticks in food and housing costs nudged the Senior Citizens League’s model to 2.6 %, while independent analyst Mary Johnson places the increase at 2.7 %. Either figure would translate into roughly $44 more per month for the average retiree check. Curious how it stacks up? See the snapshot below.
| Year | Final or projected COLA | Avg. monthly benefit change* |
|---|---|---|
| 2025 | 2.5 % (final) | +$41 |
| 2026 | 2.6 %–2.7 % (estimate) | +$42–$44 |
*Based on the current average benefit of $1,760.
Higher Medicare Part B premiums could mute the impact of a larger cost‑of‑living adjustment for many seniors
Medicare’s standard Part B premium is projected to jump 11.6 % to $206.50 in 2026, siphoning off much of the raise before it ever reaches recipients’ wallets. “It’s not uncommon for the premium to eat up the entire COLA,” Johnson warns. Low‑income seniors worried about that squeeze also face uncertainty from the new One Big Beautiful Bill Act, which could drop some beneficiaries from coverage even as it enlarges a tax deduction for others.
So, what’s a retiree to do?
• Review your annual Social Security statement as soon as the official COLA is revealed in October.
• Compare the new benefit to anticipated Medicare deductions and prescription costs.
• Explore Medicare Savings Programs or Extra Help if premiums threaten your budget.
• Keep receipts: inflation data for 2027’s COLA starts accumulating this fall.
“Consequently, every dollar still counts,” notes Shannon Benton of TSCL, who is urging lawmakers to adopt a senior‑focused inflation index and a one‑time catch‑up payment.
Bottom line
A 2.6 %–2.7 % raise is welcome news, yet higher medical bills mean not everyone will feel richer come January. Staying informed—and acting quickly when enrollment windows open—will help protect the buying power of that hard‑earned benefit.