While one of the two monthly Social Security COLA forecasters has significantly adjusted her 2027 estimate based on the March inflation data released today by the Bureau of Labor Statistics, the other is standing pat for the third straight month.
The Senior Citizens League (TSCL) predicts that the 2027 Cost of Living Adjustment (COLA) will be 2.8%, the same as the 2026 COLA of 2.8% and unchanged from its forecasts from the past two months. If the 2027 COLA were to be 2.8%, the average benefits check for retired workers would increase by $56.69, from $2,024.77 to $2,081.46.
“This represents the biggest single month jump we’ve seen in inflation since 2022.”
Independent Social Security and Medicare policy analyst Mary Johnson
Meanwhile, independent Social Security and Medicare policy analyst Mary Johnson said today that rising gasoline prices are driving her estimate for the 2027 COLA to 3.2%, up significantly from her estimate last month.
“This represents the biggest single month jump we’ve seen in inflation since 2022 (which was also the March data for the year),” Johnson said in a statement today. To put the size of this change in context, two months ago Johnson estimated that the COLA for 2027 would be just 1.2% based on January 2026 data, and adjusted it to 1.7% last month.
“This is the tip of the inflation iceberg,” Johnson said. As geopolitical tensions with Iran continue, she said there will likely be continued upward price increases for many goods and services including groceries and shelter as rising gasoline prices and supply chain disruptions get passed along to consumers. Johnson said she is closely watching those oil prices, as the CPI-W used to calculate the COLA is weighted more heavily for gasoline.
Today’s inflation report shows the CPI-W increased 3.3% over the last 12 months. For the month of March, the index that determines Social Security COLAs increased 1.3% prior to seasonal adjustment.
Notably, gas prices spiked 21.2% between February and March, a record increase. AAA data showed the national average for gasoline skyrocketed in March, ending the month at $4.018—surpassing $4 for the first time in four years (it currently sits at $4.15). Energy prices overall rose 10.9% over the month, the largest increase since September 2005, after a 0.6% rise in February.
With seven more months of data to come before the official 2027 COLA can be calculated in October, Johnson noted that her estimate is likely to change. The COLA is determined by inflation in the third quarter of the year—July, August, and September. Social Security adds the inflation for each month together, determines the average and compares that to the average from the 4th quarter a year ago. The percentage of change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) is used to determine the COLA adjustment payable with the check received in January of the following year.
For seniors 65 and over who get their health insurance coverage through Medicare, Medicare premiums are taken directly from Social Security payments. Those premiums rose substantially in 2026, going from $185 in 2025 to $202.90 in 2026. This means retirees saw their costs increase by close to 10%. For retirees who receive the average monthly Social Security benefit of $2,071 in 2026, the $17.90 in extra premiums take up nearly a third of their monthly $57.99 benefits increase.
Today the Bureau of Labor Statistics (BLS) released the March Consumer Price Index numbers (CPI). The Bureau of Labor Statistics tracks the costs of a basket of goods and services that are part of this financial index. By seeing how much all of these goods and services cost, and comparing that number to CPI numbers from prior months, the BLS can get an estimate for the economic inflation that is occurring.
The official Social Security COLA for the next year is calculated based on CPI-W data from the third quarter of the current year (July, August and September), meaning the official 2027 COLA will not be announced until mid-October 2026. Social Security adds the inflation for each month together, determines the average and compares that to the average from the fourth quarter a year ago. The percentage of change in the CPI-W is used to determine the COLA adjustment payable starting with the check received in January of the following year.
The next monthly update on 2027 COLA forecasts will come on May 12, the day the Bureau of Labor Statistics releases CPI data for April.
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