It’s Official: Social Security COLA Set at 2.8%
The Social Security Administration (SSA) announced today that the cost-of-living-adjustment (COLA) will be 2.8% in 2026. On average, benefits will be raised by nearly $56 per month for retirees beginning in January.
“Social Security is a promise kept, and the annual cost-of-living adjustment is one way we are working to make sure benefits reflect today’s economic realities and continue to provide a foundation of security,” said Social Security Administration Commissioner Frank J. Bisignano in a statement. “The cost-of-living adjustment is a vital part of how Social Security delivers on its mission.”
The new figure is an increase from 2025, when the cost-of-living-adjustment (COLA) was 2.5%. According to The Senior Citizens League (TSCL), the figure is about average and ranks 29th out of the 51 COLAs announced.
TSCL notes a steady rise in inflation since its initial estimate in February of 2.1%. Tariffs implemented by President Donald Trump, along with other economic policies, further raised inflation throughout 2025.
COLA numbers are based on inflation figures in the third quarter of the year. The official data was scheduled to release on Oct. 15 but was postponed because of the ongoing federal government shutdown.
The COLA announcement has only ever been delayed once before; in 2013 during another government shutdown.
While the official figures will raise average retiree benefits, much of that income could get eaten by rising healthcare costs, notes independent Medicare and Social Security Policy Analyst Mary Johnson. “Rising Medicare premiums alone could fully consume the COLA for many seniors in 2026,” she observed.
Medicare Part B premiums and some Part D plan premiums are on track to cost significantly more in 2026, with the standard monthly Part B premium estimated to rise $21.50 from $185 to $206.50 in 2026. If this happens, it would be the highest premium jump in program history, Johnson adds. The official announcement for Medicare Part B premiums won’t come until later this month or November.
Retirees enrolled in prescription drug plans could also see increases in premiums by as much as $50 in 2026, Johnson states. In 2024, the federal government provided a temporary stabilization demonstration program to stabilize these premiums, of up to $15 and limited the monthly premium increase for the year to $35. For 2026, the Trump Administration has lowered the premium subsidy from $15 to $10 and has allowed Part D plans to increase its monthly premiums by as much as $50.
Johnson, who as a Medicare recipient has been impacted by spiking Part D premiums, uses the Medicare Drug Plan Finder to track down less costly drug plan choices. “If I keep my current drug plan my estimated premium and drug costs would rise from $395 in 2025 to about $1,079 in 2026 for the very same two generic drugs that I take today,” Johson explains. “That’s a total increase of $683 or 173%. Yes, a very far cry from a 2.8% COLA increase.”
Seniors call for reform
Research from TSCL shows that beneficiaries are calling for a change in how the administration calculates the annual COLA figure. According to findings, 93% of seniors say Social Security and Medicare reform should be a top priority for the Trump Administration and Congress. When asked to pick one area of Social Security to prioritize, seniors picked “better COLAs” as their top choice at 34%, followed by “improving Social Security’s long-term finances,” at 33%.
“The 2026 COLA is going to hurt for seniors. Year after year, they warn that Social Security’s meager increases won’t be enough, and the Census Bureau estimates that about 10 percent of retirement-age Americans live in poverty,” added Shannon Benton, executive director for TSCL. “However, our research suggests that the number may be higher. It’s about time our elected representatives show up for seniors, or else seniors won’t show up for them at the voting booth.”
TSCL and Benton say the administration could calculate the annual figure with the Consumer Price Index for the Elderly (CPI-E) instead of the Consumer Price Index for Urban Wage Earners (CPI-W), and institute a minimum COLA of 3%. The CPI-E is specifically designed to represent older Americans’ spending habits and comes in higher than the CPI-W nearly 69% of the time. This results in thousands of dollars in lost benefits for seniors, Benton explains.
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.
