The 2026 Social Security cost-of-living adjustment, or COLA, will take effect with the payment that beneficiaries receive in January, and is designed to help retirees, their spouses, disabled individuals, and other beneficiaries keep up with the rising costs of goods and services.
To be clear, we don't know for a fact what the 2026 Social Security COLA will be just yet. That announcement won't come until mid-October, after September's inflation data is released.
However, we have a pretty good idea of what it will be. The Social Security COLA is based on third quarter consumer price index (CPI) data, and we already have the numbers for July and August.
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Based on what we know so far and the expected September inflation numbers, the Senior Citizens League projects a 2.7% COLA for 2026. Just be aware that we could potentially see this move 0.1% or so in one direction or the other if we get a surprising inflation figure.
With that in mind, the average retired worker gets about $2,000 per month from Social Security. So, let's take a look at how the 2026 Social Security COLA could impact someone with this benefit amount.
What the 2026 COLA would mean to a $2,000 Social Security benefit
Here's the short answer. If you currently get $2,000 per month from Social Security, which is approximately what the average retired worker receives, a 2.7% COLA would increase your monthly benefit to $2,054.
If you're under 65, this is the end of the story. But, there's more to consider if you're 65 years old or older.
Here's why. Social Security beneficiaries who are 65 or older typically pay their Medicare Part B premiums directly from their monthly payments, similar to a payroll deduction for health benefits and employer might offer. And Medicare Part B premiums are expected to rise significantly in 2026.
In 2025, Medicare Part B premiums are $185 per month for all individuals not considered to be higher income retirees. In 2026, premiums are projected to be $206.50 per month, an increase of nearly 12%.
So, if you pay Medicare Part B premiums from your Social Security and your base benefit amount is $2,000 per month, your Medicare costs reduce that to $1,815 in 2025.
If the 2026 Social Security COLA increases your benefit to $2,054 next year, but the Medicare premium rises as expected, it would result in an effective monthly Social Security benefit of $1,847.50. That's an increase of $32.50 per month -- not the $54 that the COLA might lead you to believe.
The bottom line on the 2026 Social Security COLA
Of course, different people will be impacted differently, and this is just an example of how someone with a Social Security benefit near the national average could see their monthly payments change. If your Social Security benefit is significantly higher or lower than $2,000 per month, the combination of the COLA and changing Medicare premium will have a somewhat different effect on your purchasing power.
Finally, the question of whether the 2026 Social Security COLA will be enough of a raise to help you keep up with the rising cost of goods and services is a little more complicated. There's a solid argument to be made that the inflation that impacts seniors the most (like healthcare) is rising significantly faster than 2.7%, for example. But by knowing how the COLA and changing Medicare Part B premium will affect your retirement income can help you prepare and budget for expenses in 2026.
