Home Finance Social Security Cost-of-Living Adjustment (COLA) Projected To Shrink Further in 2026
Social Security Cost-of-Living Adjustment (COLA) Projected To Shrink Further in 2026

Social Security Cost-of-Living Adjustment (COLA) Projected To Shrink Further in 2026

by biztrendz

Key Takeaways

  • For 2026, the Senior Citizens League predicts a smaller cost-of-living adjustment for Social Security benefits compared to last year.
  • They estimate that the COLA will be 2.1% in 2026, which is down from 2.5% in 2025 and 3.2% in 2024.
  • While inflation has declined in the past two years, it remains persistent, weighing on some retirees’ finances.

In 2026, retirees may see a smaller cost-of-living adjustment (COLA) for their Social Security benefits.

The Senior Citizens League (TSCL), a nonpartisan senior group, projected 2026 COLA to be 2.1% in their recently released their monthly estimates.

This would mark a decline from the COLA increases in recent years and reflects a slowdown in inflation. The COLA was 2.5% in 2025, 3.2% in 2024, and 8.7% in 2023.

The COLA is made annually and is meant to protect people’s Social Security benefits from being eroded by inflation. The Social Security Administration typically announces the official COLA adjustment in October.

Inflation Has Cooled, Yet Remains Persistent

Although inflation has fallen from it’s peak of more than 9% in the summer of 2022, it’s proven stubborn.

The TSCL based its estimate on the latest CPI report, which showed an uptick in inflation from the year prior. COLA is tied to the CPI-W, or the Consumer Price Index for Urban Wage Earners and Clerical Workers. For December, the CPI-W was 2.8%, up from 2.6% in November.

“While slowing inflation is a good thing, it doesn’t mean prices will fall—just that they’ll rise more slowly. This leaves many seniors facing a budget shortfall,” states the TSCL release.

And recent data indicates that a high cost of living has burdened some retirees. Nearly one-third of retirees reported that they were spending more than they could afford, a recent survey showed.

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