The Social Security Administration determines cost-of-living adjustments based on the Bureau of Labor Statistics’ Consumer Price Index.
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KEY TAKEAWAYS
That would be a 1 percentage point increase from the 2026 COLA and the biggest boost since 2023.
Gas prices and inflation trends, influenced by the Iran conflict, are expected to affect the final COLA calculation.
The next cost-of-living adjustment (COLA) for Social Security benefits is projected to be bigger than this year’s boost.
The 2027 COLA adjustment is expected to be 3.8%, a one percentage point increase from thi year’s COLA, according to the most recent estimate from The Senior Citizens League, an advocacy group. That means the average beneficiary would receive almost $74 more a month from their Social Security check.
Why This Matters
More than 75 million Americans receive Social Security benefits. Knowing next year’s benefit amount helps retirees plan their budgets and see whether Social Security is keeping pace with rising costs.
This is still an early estimate based on the available inflation data. The Social Security Administration (SSA) will announce the official COLA in October. If the 2027 COLA is 3.8%, it would be the biggest boost since 2023.
The SSA calculates the COLA using the year-over-year change in inflation during the third quarter (July-September). The inflation measure used is the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
U.S. inflation ticked up earlier this year following the start of the conflict in Iran, as energy prices rose and, in turn, other product prices followed suit.
However, the latest projected 2027 COLA is slightly smaller than last month’s estimate, as a truce in the war in Iran cooled gas prices. In the latest CPI-W report for June, which will not feed directly into the COLA formula, inflation fell by 0.4%, led mainly by a 9.7% drop in gasoline prices.
However, the slight dipmay not last. Gas prices in the third quarter of 2026 could pick back up as fighting in the Iran war resumed this week.
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