A new report on the future of social security benefits is bad news for millions of retirees who are on a fixed income. With prices continuing to climb, many seniors are already under serious financial stress.
Worried senior couple reviewing bills and finances at home. This scene captures the growing anxiety many retirees feel as the latest Social Security COLA projection threatens to act like a cut in their real buying power.
Stock photo via Getty Images
Every year, Social Security payments undergo a cost-of-living adjustment, known as a COLA, which is designed to help seniors cope with rising prices. The rate of the COLA is calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W. A new Yahoo! Finance report shows that The Senior Citizens League (TSCL) is projecting that the 2027 COLA will be just 2.8%, the same increase seniors got for 2026. Alternatively, analyst Mary Johnson told the outlet she expects a slightly higher 3.2% jump, as she believes gas prices will drive the figure up.
In October 2025, MarketWatch reported on the findings of Goldman Sachs Asset Management Retirement Survey and Insights Report, titled “New Economics of Retirement.” It showed that costs for seniors rose by 3.6% from 2000 to 2023, a full percentage point faster than the 2.6% general inflation rate over the same period. That was the case because seniors tend to spend more in economic categories that rise faster than general inflation, like healthcare and housing.
If seniors see their expenses rise by 4% in 2027, which seems realistic given past trends, their costs will grow faster than their Social Security increase by an estimated hundreds of dollars annually. TSCL executive director Shannon Benton told Yahoo! Finance that the Social Security increase that seniors are projected to get simply isn’t enough.
“With everyday costs continuing to climb, the gap between a projected COLA and real-world expenses is hard to ignore. Beef prices remain elevated, energy costs are rising, and a quick trip to the grocery store makes it clear that a 2.8% increase is not enough to keep up with inflation for cash-strapped Social Security recipients.”
The final 2027 COLA number won’t be confirmed until mid-October, so it could still move slightly higher than current projections. Still, since the adjustment is tied to the CPI-W, it almost certainly won’t fully match the increase in expenses many seniors will face. That isn’t the only problem. Social Security raises only happen once a year. So, if inflation surges after the adjustment is locked in, retirees could face very serious financial shortfalls for months. On the brighter side, if inflation drops significantly, that would help seniors on fixed incomes and most people.
This story was originally published by Men’s Journal on Apr 15, 2026, where it first appeared in the News section. Add Men’s Journal as a Preferred Source by clicking here.
