The Average Senior on Social Security Should Get a $900 Boost in 2027

Quick Read

• A 3.6% cost-of-living adjustment lifts the typical Social Security benefit by about $75 monthly, or roughly $900 annually, in 2027.

• Retirees should put the extra money toward emergency savings or pressing expenses, such as car repairs, rather than rushing to spend it.

• COLAs only keep pace with inflation, so struggling retirees should seek extra income through part-time work, gig jobs, or renting out unused home space.

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If Social Security paid more generously, it would be a lot easier to retire on those monthly benefits alone. The reality, though, is that the typical Social Security recipient today gets about $2,090 per month. On an annual basis, that’s just a little more than $25,000, which doesn’t allow for much breathing room, especially when unexpected costs arise.

Thanks to a generous cost-of-living adjustment (COLA), the typical Social Security benefit will be rising about $75 per month in the new year, or roughly $900 all in. If that increase is meaningful to you, it’s important to put it to good use.

Make the most of your 2027 COLA

At the start of 2026, Social Security benefits got a 2.8% COLA. Next year’s raise is much more substantial at 3.6%, which allows the typical benefit to receive a $900 annual increase.

If money is tight and you don’t have much savings, it’s important to make the most of your extra $900 in 2027. If you’re already managing your bills on your current Social Security check, what you could do starting in January is put the extra money you get in your benefits into a savings account. That way, it’s there for you in an emergency situation, like if you end up in the hospital with a large medical bill to follow.

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You may also want to use your 2027 COLA to address pressing expenses you can’t currently afford. If your car needs a $150 repair, for example, by February, you may have that money thanks to your $75 monthly increase, assuming you collect an average benefit.

Don’t expect your upcoming COLA to improve your finances substantially

A $900 increase in 2027 may seem like a lot of money. But remember, all COLAs are meant to do is catch Social Security benefits up to inflation. The upcoming 3.6% COLA probably isn’t going to improve your finances a whole lot.

Sure, an extra $900 a year might be helpful. It could pay for a home repair, give you a little extra spending money, or serve as a small emergency fund.

But if it’s generally been a struggle to keep up with your costs, you may want to look outside of that Social Security COLA to improve your financial situation. That could mean taking a job to boost your income, whether it’s a part-time role on a preset schedule or dabbling in the gig economy.

If working doesn’t appeal to you, consider turning your home into an income source. A finished basement or garage you rarely use could allow you to earn rental income.

Next year’s Social Security COLA is the highest to arrive in the past few years. You may be looking forward to larger monthly checks, and rightfully so.

But don’t rush to spend that money. Instead, save it for essential costs and emergencies. And if you’re in a position where you truly need that extra $900, consider it a wake-up call that your financial situation might need an overhaul. Otherwise, your struggles might continue well past 2027.

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