Projected Social Security Cost-of-Living Adjustment (COLA) for June 2026 escalates in response to recent inflation spike

Projected Social Security Cost-of-Living Adjustment (COLA) for June 2026 escalates in response to recent inflation spike

Social Security Benefits to Increase by 2.7% in 2026

Good news for over 72.5 million Americans who receive Social Security benefits and Supplemental Security Income (SSI) payments. The Social Security Administration (SSA) is expected to announce a modest increase in Social Security benefits for 2026, with a projected increase of around 2.7%.

The Cost-of-Living Adjustment (COLA) for 2026 is calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a subset of the CPI that tracks the expenses of a narrower slice of American households than the CPI-U. The COLA takes into account inflation rates for July, August, and September of the current year compared to the same period of the previous year.

The 2.7% COLA estimate has been confirmed by policy experts such as The Senior Citizens League and inflation data analysis, although the final official announcement from the SSA will come in October 2025. This forecast is based on recent inflation trends that continue to push prices higher.

The average Social Security monthly check for retired workers was $2,005.05 for June 2025. With a 2.7% increase, retirees could see roughly a $54 monthly increase on an average benefit of around $2,006.69 as of July 2025. This cost-of-living adjustment (COLA) is designed to help Social Security beneficiaries keep pace with rising costs of living, particularly for essentials like healthcare and housing.

It's important to note that the hold harmless provision, which protects Social Security benefit payments from decreasing due to an increase in the Medicare Part B premium, only applies to Social Security recipients who receive benefits for November and December 2024. If Medicare Part B premiums are paid by state Medicaid agencies, the hold harmless provision does not apply. High-income Social Security recipients who have to pay IRMAA for Part B and Part D coverage are also exempt from the hold harmless provision.

For those who pay an income-related monthly adjustment amount (IRMAA) premium and don't have it deducted from their Social Security check, the hold harmless provision does not apply. Medicare Part B premiums for November 2024 through January 2025 are deducted directly from monthly Social Security benefits.

The Consumer Price Index for all items rose 2.9% from December 2023 to December 2024. However, the CPI-W weighted medical care at 5.6%, while the CPI-E, which reflects the costs of older adults more accurately, weighted medical care at 11.3%. The CPI-E has been proposed as an alternative to the CPI-W for COLA calculation.

In conclusion, the 2.7% increase in Social Security benefits for 2026 is a welcome relief for many Americans. The COLA is an essential mechanism to help retirees maintain their purchasing power in the face of inflation. The SSA's official announcement of the increase is expected in October 2025.

[1] The Senior Citizens League. (2025). Social Security COLA Expected to Rise 2.7% in 2026. [Online]. Available: https://www.seniorcitizensleague.org/2025/09/social-security-cola-expected-to-rise-2-7-in-2026/ [2] Social Security Administration. (2025). Frequently Asked Questions About COLA. [Online]. Available: https://www.ssa.gov/cola/ [3] AARP. (2025). Social Security COLA Expected to Rise 2.7% in 2026. [Online]. Available: https://www.aarp.org/politics-society/social-security/info-2025/social-security-cola-2026.html [4] The Balance. (2025). Social Security COLA 2026: What You Need to Know. [Online]. Available: https://www.thebalance.com/social-security-cola-2026-what-you-need-to-know-4178605 [5] Investopedia. (2025). Social Security COLA. [Online]. Available: https://www.investopedia.com/terms/c/cola.asp

Businesses and individuals alike should keep an eye on the 2.7% increase in Social Security benefits for 2026, as it could potentially impact personal-finance plans for retirees. The cost-of-living adjustment (COLA) for the next year could help retirees maintain their purchasing power, considering inflation trends and essential costs like healthcare and housing.

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