Social Security COLA increased announced soon: Prepare to be disappointed, experts warn

Retirees hoping for a substantial increase in Social Security benefits this year will likely be disappointed despite being on a track for record cost of living adjustment (COLA).

The latest forecast from the advocacy group The Senior Citizen League puts 2027’s COLA at 3.5%, the highest level in four years. That figure is a drop of 0.1 percentage points from last month’s TSCL prediction but 0.7 percentage points higher than the 2.8% COLA for 2026. It’s also 1 percentage point higher than 2025’s COLA of 2.5%.

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That may sound like good news for retirees but the boost isn’t enough to keep up with inflation, TSCL Executive Director Shannon Benton said.

“No matter if the COLA announcement comes in slightly higher or slightly lower than our prediction, seniors will probably end up disappointed in the long run,” Benton said. “The reality is that older Americans allocate their budgets differently than people still in the workforce, so inflation hits them differently.”

If the prediction holds, the average Social Security benefit will increase by $67.90 a month. The current average beneficiary receives $1,940.08 in their monthly Social Security check. With a 3.5 percent COLA, that would rise to $2,007.98.

That falls short as seniors face higher prices for food, housing and fuel.

“The COLA only happening once a year puts life on hold for a lot of seniors. When prices rise, they don’t rise next January when your benefit check goes up. They rise right now. We need to consider (cost of living adjustments) that compound quarterly or monthly so seniors can keep up throughout the year when inflation comes in above Federal Reserve targets, like in 2026.”

The Social Security Administration will announce the official 2027 COLA on Oct. 14. The figure is calculated by determining average yearly change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for July, August, and September. The August CPI-W, released today, came in at 3.5 percent. The July CPI-W, released last month, came in at 3.4 percent.