Social Security recipients could receive a larger cost-of-living adjustment in 2027 than they received in 2026, but advocates say the increase still may not be enough to keep up with everyday expenses.
The latest estimate from The Senior Citizens League projects a 3.8% cost of living increase, also known as COLA, for 2027. That would be higher than this year’s 2.8% increase. The advocacy group’s forecast is based on the most recent Consumer Price Index for Urban Wage Earners and Clerical Workers, known as the CPI-W, which is used to calculate annual Social Security adjustments.
The CPI-W tracks changes in the prices consumers pay for goods and services. Social Security uses the average CPI-W from July, August and September and compares it with the same period from the previous year. The percentage increase becomes the COLA that takes effect the following January. The official 2027 adjustment will not be announced until October.
If the projected 3.8% increase becomes official, the average monthly retirement benefit would rise by about $77. According to the Social Security Administration, the average retired worker currently receives $2,026.41 each month. Under the latest forecast, that would rise to roughly $2,103.41.
Even with the larger increase, many seniors say their monthly benefits still fall short of covering basic needs. The Senior Citizens League estimates that the average older American living alone spends about $2,700 each month on housing, food, transportation and health care costs, according to The Senior Citizens League.
Shannon Benton, executive director of The Senior Citizens League, said higher COLAs have not fully kept pace with rising prices in recent years. She said the purpose of Social Security is to provide financial security for retirees. She questioned whether current benefits are meeting that goal for millions of older Americans
The group also noted that nearly 24.8 million older Americans depend entirely on Social Security for their retirement income. That means even small increases in benefits can significantly impact their finances, though the increases may not fully offset higher living costs.
For now, the 3.8% figure remains only a forecast. Inflation data from the coming months could cause the estimate to rise or fall before the Social Security Administration announces the official 2027 COLA later this year. Until then, many retirees will be watching closely and hoping the increase will help them better afford basic necessities.
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