Social Security's 2026 COLA: Recipients could get more money next year
Social Security recipients’ monthly checks could be higher than originally thought next year with the cost-of-living adjustment, or COLA.
According to an estimate from The Senior Citizens League, a seniors’ advocacy group, inflation data from May marks the fourth consecutive month that the group’s model shows a higher COLA for next year.
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The Social Security Administration adjusts monthly benefits every year to reflect increases in inflation. If there’s higher inflation, the monthly benefit is higher as well.
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Social Security COLA 2026
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By the numbers:
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TSCL now predicts that the 2026 COLA will be 2.5%, up from the prior month’s estimate of 2.4% and the March estimate of 2.3%.
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FILE – Blank Social Security checks are run through a printer at the U.S. Treasury printing facility February 11, 2005 in Philadelphia, Pennsylvania. (Photo by William Thomas Cain/Getty Images) <!–>
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The COLA for 2025 was 2.5%, the lowest annual increase since 2021, FOX Business reports. The boost increased average monthly benefits by $48. The federal government’s inflation data for May showed inflation ticked slightly higher on an annual basis last month, rising 2.4% compared with a year ago.
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RELATED: Social Security Fairness Act: Where the expanded benefits stand
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The high inflation following the height of the COVID-19 pandemic peaked in June 2022 at a 40-year high.
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Concerns over ‘inaccurate’ inflation numbers
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Dig deeper:
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The monthly COLA analysis from TSCL highlighted a Wall Street Journal report that found the Bureau of Labor Statistics (BLS), which collects monthly inflation data for its consumer price index (CPI), is checking less businesses for its monthly report due to a hiring freeze at the federal agency.
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The agency told outside economists that their new method for estimating price changes is less proven than methods used in the past. Economists have raised concerts about what less accurate data will mean for the economy.
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What they’re saying:
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“While streamlining the federal government is a good thing, that shouldn’t involve cutting back on our ability to measure how our economy is changing,” TSCL Executive Director Shannon Benton said in a statement. “Inaccurate or unreliable data in the CPI dramatically increases the likelihood that seniors receive a COLA that’s lower than actual inflation, which can cost seniors thousands of dollars over the course of their retirement.
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Big picture view:
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Benton said despite what the numbers show, seniors are experiencing a disconnect between the official inflation data and the prices seniors are paying day-to-day.
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“If the government tells us that prices are rising faster, it’s likely that seniors are already feeling the crunch,” Benton said.
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The Source: This report includes information from The Senior Citizens League, FOX Business and The Wall Street Journal.
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