In October 2025, over 70 million Americans will discover how much more they’ll receive in Social Security benefits in 2026. This yearly increase, known as the Cost-of-Living Adjustment (COLA), helps ensure benefits keep pace with inflation.
The projected COLA for 2026 is approximately 2.5%, assuming inflation trends as expected. This percentage is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) measured during the third quarter of 2025.
What a 2.5% COLA Means for Retirees
For the average retiree currently receiving slightly over $2,000 per month, a 2.5% COLA would result in an increase of about $50 each month, equaling $600 annually. While this is not a dramatic boost, it’s still meaningful for individuals living on fixed incomes.
However, it’s essential to note that Medicare Part B premiums are also expected to rise. The standard monthly premium may increase by at least $21.50 in 2026. Because most seniors have this amount automatically deducted from their Social Security, the actual increase in take-home benefits will be closer to $28.50 per month, or around $342 per year.
Thus, while the headline adjustment is 2.5%, the real net gain after healthcare costs is likely closer to 1.4%.
How COLA Is Determined
The COLA is mandated by a 1973 law, designed to protect Social Security and Supplemental Security Income (SSI) recipients from the impact of inflation.
It is calculated by comparing the average CPI-W from July through September of the current year to the same period the previous year. For reference, the Q3 2024 CPI-W was 303.420.
The Bureau of Labor Statistics (BLS) publishes these numbers monthly, and the official COLA for 2026 will be released in mid-October 2025.
When Will the Increase Be Reflected?
Recipients will first see the adjusted benefits in their December 2025 payments, payable in January 2026. The same increase applies to federal SSI payments, which are scheduled for January 2026, though due to the New Year’s Day holiday, SSI beneficiaries will receive the boost on December 31, 2025.
Historically, COLAs have averaged 3.7% since 1975, but the average has dropped to 2.6% since 2000.
The “Hold Harmless” Rule Explained
Those receiving less than $800 per month might be impacted by the hold harmless rule. This regulation ensures that an increase in Medicare Part B premiums does not reduce a beneficiary’s Social Security income if the COLA isn’t large enough to offset it.
Public Sentiment: AARP Survey Reveals Concerns
Coinciding with the COLA forecast, a recent AARP survey conducted to mark Social Security’s 90th anniversary reveals deep public concern about the program’s stability and service quality.
Key findings include:
- 78% of Americans worry Social Security won’t offer enough income for retirement (up from 74% in 2020).
- 65% of current retirees heavily rely on it for their expenses.
- 64% believe the average monthly benefit of $2,000 is too low.
- Just 25% of people under 50 trust the system’s long-term viability, versus 48% of those over 50.
- Over one-third mistakenly believe no benefits will be paid after the 2034 trust fund depletion.
Service Issues at the SSA
The survey also uncovered growing frustration with Social Security Administration (SSA) services:
- Call wait times exceed two hours for nearly half of all callers.
- Appointments at local offices can take 35–40 days.
- In rural areas like Alaska, physical access to field offices may even require air travel.
These issues highlight logistical and operational challenges that continue to affect access and support for millions of Americans.
While retirees can expect a modest benefit increase in 2026 thanks to the 2.5% COLA, rising Medicare costs will reduce the net gain. The true increase in income will likely be closer to 1.4%.
Meanwhile, growing public unease about the future of Social Security—especially among younger adults—underscores the need for structural reform and service improvements. For millions of Americans, Social Security remains an indispensable part of retirement planning, even as uncertainties loom ahead.
FAQs
When will the 2026 Social Security COLA be officially announced?
The official COLA will be released in mid-October 2025 by the Bureau of Labor Statistics based on third-quarter CPI-W data.
How will the 2026 COLA impact my Social Security check after Medicare deductions?
While the projected COLA is 2.5%, the net increase after deducting Medicare Part B premiums will be approximately 1.4%.
What is the “hold harmless” rule, and who does it affect?
The hold harmless rule protects those with lower Social Security payments (typically under $800/month) from having their benefits reduced due to rising Medicare premiums.