Illustration of Social Security card saying COLA: Since 1975
The Social Security Administration's 2026 cost-of-living adjustment for Social Security beneficiaries will be 2.8%. On average, Social Security retirement benefits will increase by about $56 per month starting in January.
The annual COLA is based on inflation data for the third quarter, through September. It was originally set to be released on Oct. 15, but it was delayed due to the ongoing federal government shutdown.
The consumer price index data for September, released Friday by the Bureau of Labor Statistics, shows inflation ran at 3.0% over the past 12 months before a seasonal adjustment and was up 0.3% during September on a seasonally adjusted basis.
The 2026 COLA is larger than 2025’s increase of 2.5% but smaller than 2024's increase of 3.2%, which itself followed a near-record increase of 8.7% in 2023.
A Near-Average COLA
The Social Security Administration uses average inflation in the third quarter, based on the consumer price index for urban wage earners and clerical workers (CPI-W), to calculate the benefit adjustment for the following year.
The final 2.8% figure for 2026 is roughly in line with analysts' projections made during the year. It's also near the 2.6% average over the past 20 years.
September Inflation Highlights
The index for gasoline rose 4.1% in September and was the largest factor in the all items monthly increase, as the index for energy rose 1.5% over the month.
The food index increased 0.2% over the month as the food consumed at home index rose 0.3% and the food away from home index increased 0.1%. The index for all items less food and energy rose 0.2% in September after rising 0.3% in each of the two preceding months.
Indexes that increased over the month include shelter, airline fares, recreation, household furnishings and operations, and apparel. The indexes for motor vehicle insurance, used cars and trucks, and communication were among the few major indexes that decreased in September.
The all items index rose 3.0% for the 12 months ending September, after rising 2.9% over the 12 months ending August. The all items less food and energy index also rose 3.0% over the last 12 months. The energy index increased 2.8% for the 12 months ending September. The food index increased 3.1% over the last year.
Credit: David Palmer/ALM
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.