As 2026 Social Security COLA Wait Continues, Research Shows Use of ‘Wrong Index’ Costly for Seniors
As we wait the extra nine days for the official 2026 Social Security cost-of-living adjustment to be announced next Friday, Oct. 24 (a delay caused by the ongoing government shutdown), a new analysis from The Senior Citizens League shows how the average senior has been hurt by the government using “the wrong price index” to calculate the annual COLA.
On Oct. 15—the day the official COLA was supposed to be announced prior to the government shutdown—TSCL released research showing that the average senior who retired in 1999 has lost nearly $5,000 in Social Security payments as a result of the government using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) instead of the Consumer Price Index for the Elderly (CPI-E), an alternative index for Americans age 62 and older that weighs healthcare costs more heavily than the CPI-W.
TSCL advocates for the COLA to be calculated using the CPI-E, which is designed to reflect seniors’ budgets and tends to come in slightly higher than the CPI-W, which tracks inflation for people who work and live in cities. On average, the CPI-E comes in about 0.1 percentage points higher than the CPI-W.
“Continuing to calculate COLAs with the CPI-W when the CPI-E is already available is a great example of how Congress refuses to make even small changes that would benefit seniors. It’s not as if switching to the CPI-E would involve setting up some new metric. It already exists, and by definition, it’s better for American seniors,” said TSCL Executive Director Shannon Benton.
“If Congress continues to pass the buck on switching to the CPI-E, the problem is only going to get worse and worse,” she added. “Current retirees’ Social Security benefits will fall further behind inflation, while future retirees won’t just fall behind—they’ll start from the back.”
TSCL’s analysis predicts that, if current long-term inflation patterns continue, the average person who retired in 2014 will lose about $8,000 of benefits across a 25-year retirement from using COLAs calculated with the CPI-W instead of the CPI-E. For someone who retired in 2024, we project that number to rise to just over $12,000.
Multiple bills have been introduced in Congress over the years to change the COLA calculation to the CPI-E, “but they keep getting bogged down in D.C. gridlock,” the TSCL release said. Examples include the Social Security Expansion Act (2025), the Boosting Benefits and COLAs for Seniors Act (2024), the Social Security 2100 Act (2023), and the Fair COLAs for Seniors Act (2023). None of the Democrat-backed bills—lacking bipartisan support—have passed into law.
“Seniors are tired of hearing that ‘no cuts’ is the best the government can offer them on Social Security,” Benton added. “Our research shows that 93% of older Americans believe Social Security reform should be a high priority or top priority for the Trump Administration and Congress. They’re telling us they want change, and while switching to the CPI-E certainly won’t fix everything, at least it’s a start.”
TSCL’s 2025 Senior Survey estimates that approximately 21.8 million seniors, or 39% of Americans older than 65, depend on Social Security for 100% of their income. That study also finds the median senior gets by on less than $2,000 per month, with an estimated 7.3 million surviving on less than $1,000 per month.
A recent report by the Transamerica Institute found that 69% of Americans expect Social Security to help fund retirement, and 32% assume they’ll depend on it as their primary source of funding.
2026 COLA announcement due Oct. 24
The Social Security Administration is now scheduled to announce the official 2026 cost of living adjustment (COLA) on Friday, October 24, a delay of nine days from the original date of Oct. 15, after the federal agency responsible for reporting the data used to calculate the COLA (the Bureau of Labor Statistics) largely ceased operations as part of the ongoing government shutdown. But the BLS called back a small number of staffers on Oct. 9 expressly to facilitate the release of CPI September data—the final piece in the 2026 COLA puzzle—before the federally mandated deadline of Nov. 1.
The official COLA announcement has only ever been delayed once before, in 2013 during another government shutdown that lasted 16 days over a similar funding issue related to the Affordable Care Act.
TSCL’s most recent forecast for the 2026 COLA, released in mid-September, stood pat at 2.7%. That adjustment would raise the average monthly benefit for retired workers by $54, from $2,008 to $2,062. It would be slightly higher compared to last year’s adjustment of 2.5% but a steep drop from 2024’s 3.2%. Over the past 20 years, the COLA has averaged 2.6%.
Independent Social Security and Medicare Policy Analyst Mary Johnson, who also releases a next-year COLA projection every month, estimates the final adjustment will come in at 2.8%.
The official 2026 401(k) contribution limits have also not yet been announced by the IRS, but they are typically released in late October or early November. The announcement will be based on inflation data from the third quarter of 2025, with figures being finalized shortly after the September CPI-U values are published next Friday.
SEE ALSO:
• Official Social Security COLA Expected in Late October
• Social Security COLA Projection Holds at 2.7%
• Younger Generations Counting on 401(k)s Over Social Security
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
