Is it too early to speculate how much more retirees might receive in Social Security benefits next year? Nah. In fact, The Senior Citizens League (TSCL), a nonprofit organization that advocates for seniors, does it every month.
TSCL's latest cost-of-living adjustment (COLA) prediction was especially intriguing. Social Security's 2026 COLA is on track to do something that hasn't happened in 41 years.
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The latest COLA prediction
TSCL's statistical model is updated throughout the year. This model uses multiple factors to predict the next Social Security COLA, including the Consumer Price Index (CPI), the Federal Reserve's interest rate, and the U.S. unemployment rate.
The CPI is arguably the most important piece of data used to predict the next Social Security COLA. The COLA itself is calculated using a variant of the CPI, called the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The CPI-W measures inflation experienced by primarily blue-collar workers who live in urban areas.
There has been a distinct trend in TSCL's COLA predictions so far this year. The nonprofit organization's statistical model has generated a higher projected COLA for four consecutive months. Its latest prediction is for a 2026 COLA of 2.5%.
Is a higher COLA a good thing for retirees? Not necessarily. TSCL executive director Shannon Benton warned:
Seniors should be concerned as inflation continues to tick upward. TSCL's research shows that there's a serious disconnect between the inflation the government reports and the inflation that seniors experience every day. If the government tells us that prices are rising faster, it's likely that seniors are already feeling the crunch.
Out of the ordinary
A steadily increasing Social Security COLA prediction isn't unusual. When inflation rises, it tends to continue to rise. There's sometimes a momentum effect at work.
What is out of the ordinary about TSCL's latest projected 2026 COLA, though, is that it matches the Social Security benefits increase of 2.5% received in 2025. Perhaps surprisingly, the last time there were identical back-to-back Social Security increases was in 1983 and 1984. The annual COLA in both years was 3.5%.
Some might look at the history of Social Security COLAs and argue that the last time the COLA was the same in back-to-back years was more recent than 41 years ago. They could point out that the COLA was 0% in both 2009 and 2010.
That is true. However, an adjustment of 0% is no adjustment at all. And if there's no adjustment, there's no COLA. The last time Social Security benefits were truly adjusted by the same amount in two consecutive years to reflect a change in the cost of living was in 1983 and 1984.
That said, there have been instances where the Social Security COLA was the same in two close but nonconsecutive years. This occurred in 1993 and 1995, when the benefits increase was 2.6%. It also happened in 2012 and 2014, with COLAs of 1.7% in both years.
Don't bet on the same COLA just yet
Is it a slam dunk that the 2026 Social Security COLA will do something that hasn't happened since 1984? Don't bet on it.
The actual 2026 COLA will be determined based on the average CPI-W for the third quarter of 2025 compared to the average for the third quarter of 2024. Retirees won't know the final number until the Social Security Administration releases it in mid-October.
There are also some reasons to suspect the inflation level will continue to rise later this year. The full impact of President Donald Trump's tariffs hasn't been felt yet. This is due in part to businesses increasing their inventory levels before the tariffs took effect. Many economists predict that inflation will rise more significantly during the summer months.
The Social Security COLA's 41-year streak might not be broken after all. But retirees might wish it were.
