Social Security’s 2026 Cost-of-Living Adjustment: What It Means for You
On October 24, 2025, the Social Security Administration (SSA) announced its 2026 cost-of-living adjustment (COLA) — and we wanted to share what’s changing, why it matters, and a few things you might want to keep in mind as we head into the new year.
What Was Announced?
Starting in January 2026, Social Security and Supplemental Security Income (SSI) benefits will increase by 2.8%.
This annual adjustment helps benefits keep pace with inflation, so retirees and beneficiaries don’t lose purchasing power as prices rise. You don’t have to do anything to receive the increase — it will be applied automatically to eligible payments.
How Is the COLA Determined?
Each year, the SSA looks at inflation data from the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), measuring the change in prices between July and September. If prices go up, Social Security benefits follow suit.
This year’s 2.8% COLA reflects a modest rise in inflation. While that helps, it’s worth remembering that the COLA is based on a broad measure of inflation — and may not fully account for the steeper increases many of us see in health care, housing, or groceries.
What Does This Mean for You?
The SSA estimates that the average monthly retirement benefit will increase by about $56 starting in January.
However, because Medicare Part B premiums are typically deducted from Social Security payments, your actual take-home amount could be a bit smaller. The Medicare Trustees project the standard Part B premium will increase from $185 in 2025 to $206.50 in 2026 — something to keep in mind as you plan your budget for the year ahead.
What You Can Do Next
✅ Watch for your COLA notice. The SSA will begin mailing notices in December, but if you have a my Social Security account, you can see your updated benefit amount sooner. You can log in or create an account at Social Security- just be sure to do it before November 19th.
✅ Take a fresh look at your budget.
Even a small increase can make a difference when it’s planned intentionally. Review your income and expenses for 2026, especially if you expect higher premiums or other cost changes.
Let’s Plan Ahead Together
I know that for many, a 2.8% increase may not feel like much given how quickly the cost of essentials has been rising. If you’d like to talk through what this update means for your income planning, budgeting, or retirement strategy, I’m here to help — whether you’re already receiving benefits or planning ahead for the future.
Feel free to give me a call to set up a time to connect. Together, we can make sure your plan stays on track and continues to support your goals.