If you're on Social Security and don't have much income outside of those monthly benefits, you may be painfully aware that your checks aren't going very far this year. Inflation has been a beast, and costs have been higher at the pump, at the supermarket, and just about everywhere.
Part of the problem is that inflation has outpaced the 2.8% cost-of-living adjustment (COLA) that Social Security benefits received back in January. But there may be some relief in sight.
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Current projections are pointing to a much larger Social Security COLA in 2027. But before you get too set on that, realize that a lot could still change in the coming weeks.
How Social Security COLAs are calculated
Social Security COLAs are based on changes to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a subset of the Consumer Price Index. The CPI-W measures price changes over time across a variety of key categories, from food to clothing to housing.
When there's an increase in the CPI-W from one year to the next, Social Security benefits are eligible for a boost in line with that increase. When there's either no increase or a decrease, Social Security benefits don't go up, but they also can't go down from one year to the next.
Because Social Security COLAs require a full set of data from the third quarter of the year, those raises are typically announced in October, after September's data arrives. This year, September's CPI-W has a scheduled release date of Oct. 14, so that's when the Social Security Administration (SSA) is expected to make the 2027 COLA official.
What current 2027 Social Security COLA estimates look like
If you're hoping next year's Social Security COLA will come in higher than this year's 2.8% raise, so far, the news is good. The Senior Citizens League, an advocacy group that tracks the Social Security COLA all year long, projects that the 2027 COLA will be 3.5%.
Mary Johnson, an independent Social Security analyst, agrees with that estimate as of mid-September. And AARP actually projects a slightly higher 3.6% COLA in 2027.
Could the 2027 COLA get a downgrade?
You may be hoping your upcoming Social Security COLA will be at least 3.5%. But you should know that if inflation cools in September, the final number could be lower.
At this point, it's unlikely that next year's COLA won't surpass this year's 2.8% boost by a good margin. Prices would have to plummet drastically by the end of September to create a scenario in which seniors don't get a notably bigger boost.
But it's absolutely possible for Social Security benefits to end up with a COLA below 3.5%. So you may not want to start counting your extra money just yet.
Another piece of the puzzle is missing
Not only do we not have complete CPI-W data for the quarter yet to make a COLA official, but even once the SSA announces that number, you may not have the full picture if you're enrolled in Medicare.
As you're probably aware, premiums for Medicare Part B are paid out of Social Security benefits automatically. But this means that if there's an increase in the cost of Part B, it could eat into your upcoming COLA, leaving you with a smaller net raise.
At the start of 2026, the cost of Medicare Part B increased by $17.90 per month. Hopefully, next year's increase will be more moderate. But even if it is, you'll need to wait for official Medicare costs to be announced to figure out exactly how much more money the 2027 Social Security COLA will add to your monthly benefits.
