The 2026 Social Security COLA Could Be The Biggest In Years — But Inflation Could Still Outpace Your Benefits

Every October, Social Security beneficiaries eagerly await news about the cost-of-living adjustment for the following year. For 2026, the adjustment could push the average Social Security check to the largest it's ever been — but even with a larger check, many retirees may still find themselves falling behind rising costs.

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Why the 2026 COLA Could Make History

Early forecasts from The Senior Citizens League suggest the 2026 COLA could lift the average retired worker's Social Security check above $2,000 for the first time ever. As of March, the average monthly benefit for retired workers was $1,997.13. A 2.3% adjustment — the current estimate, based on March inflation data — would add roughly $46 more per month for retired workers.

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The COLA is determined by comparing third-quarter data from the consumer price index for Urban Wage Earners and Clerical Workers, or CPI-W, year-over-year. If prices rise, benefits are adjusted accordingly. However, the CPI-W doesn’t perfectly match the spending habits of retirees, who often spend more on shelter and healthcare — two areas where inflation has remained stubbornly high.

Inflation Could Still Outpace Benefits

Even a 2.2% boost may not fully cover the rising costs many seniors face. According to the U.S. Bureau of Labor Statistics, medical care services and food each rose around 3% year-over-year in March, outpacing the overall inflation rate used for the COLA calculation. Shelter costs, in particular, have been a major driver of inflation, and those expenses carry more weight for retirees than for the working-age individuals the CPI-W tracks.

According to an analysis from TSCL, the buying power of Social Security dollars has declined by about 20% since 2010. Even with larger COLAs in recent years, retirees have often seen their actual living costs rise faster than their benefits.

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Tariffs Could Shake Up COLA Estimates

The final COLA announcement won’t come until October, and there are factors that could still shift the forecast. One key variable: tariffs. President Donald Trump's tariff policies, including a steep 145% tariff on Chinese goods, could drive inflation higher if trade tensions escalate. If inflation rises more sharply than expected, the 2026 COLA could end up being higher than the current 2.3% estimate — but that would also mean higher everyday costs for retirees.

Mary Johnson, a retired Social Security policy analyst, told USA Today that trade wars could increase inflation, boosting COLAs but not necessarily improving retirees’ financial situations.

Bigger Checks Bring Long-Term Concerns

While higher Social Security checks might sound like good news, they come with long-term risks. The Old-Age and Survivors Insurance Trust Fund, which supports retiree and survivor benefits, is projected to deplete its reserves by 2033 if no changes are made. Larger COLAs could potentially speed up this timeline by increasing payouts.

The bottom line? The 2026 COLA may set a record, but many retirees could still find themselves struggling to keep pace with rising costs — and the broader future of Social Security remains uncertain.

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