The Social Security COLA Forecast for 2026 Was Just Updated. It's Bad News for Retirees.
Social Security beneficiaries receive an annual cost-of-living adjustment (COLA) to keep the purchasing power of benefits aligned with rising prices across the economy. The official 2026 COLA will not be determined until October 2025 because it depends on inflation data from the third quarter, which is collected between July and September.However, The Senior Citizens League (TSCL), a nonprofit senior advocacy group, recently raised its 2026 COLA forecast to 2.3% based on recent economic data. That is higher than its January estimate of 2.1%. And while an upward revision sounds like good news, especially when so many retirees thought the 2025 COLA was too small, it actually comes with two piece of bad news.First, a 2.3% COLA could accelerate the timeline to Social Security Trust Fund depletion, leaving Congress with less time to resolve the program's funding problems. Second, based on how COLAs are calculated, the 2026 cost-of-living increase will likely understate inflation. That means benefits could (once again) lose buying power next year.Continue reading
Social Security beneficiaries receive an annual cost-of-living adjustment (COLA) to keep the purchasing power of benefits aligned with rising prices across the economy. The official 2026 COLA will not be determined until October 2025 because it depends on inflation data from the third quarter, which is collected between July and September.
However, The Senior Citizens League (TSCL), a nonprofit senior advocacy group, recently raised its 2026 COLA forecast to 2.3% based on recent economic data. That is higher than its January estimate of 2.1%. And while an upward revision sounds like good news, especially when so many retirees thought the 2025 COLA was too small, it actually comes with two piece of bad news.
First, a 2.3% COLA could accelerate the timeline to Social Security Trust Fund depletion, leaving Congress with less time to resolve the program's funding problems. Second, based on how COLAs are calculated, the 2026 cost-of-living increase will likely understate inflation. That means benefits could (once again) lose buying power next year.
