Social Security’s COLA is on the Ballot in November

Social Security's COLA is on the ballot in November, with a 3.6% increase for 2027, the biggest since 2023.

The full report

The Social Security Administration (SSA) announced a 3.6% cost-of-living adjustment (COLA) for 2027, the biggest since 2023, affecting more than 72 million people. The SSA calculates the COLA based on the average year-over-year change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for July, August, and September. This means, on average, retirement benefits will rise by $75 a month, or $900 a year, according to the SSA. The Committee for a Responsible Federal Budget (CRFB) estimates the highest earners will see an increase of more than $2,200 a year.

The COLA will also affect Medicare Part B beneficiaries, whose premiums are deducted from their Social Security payments. The 2027 standard premium is projected to rise to $209.50 from $202.90, an increase of $6.60 a month, which would leave the average retired worker about $68 a month better off after COLA. SSA Commissioner Frank J. Bisignano said the adjustment will give beneficiaries "greater financial stability," and reflects a year of elevated inflation, particularly in gasoline and energy prices.

However, some critics argue that the COLA does not fully account for the costs that Social Security beneficiaries face. Nancy Altman, president of the advocacy group Social Security Works, said that the CPI-W, the inflation index used to calculate Social Security increases, tracks the costs of working people, not retirees, who she said spend a higher share of their income on health care and housing. Altman said that next year's COLA "can't come soon enough for many Social Security beneficiaries," but that it "doesn't fully account for the costs that Social Security beneficiaries face."

The Senior Citizens League (TSCL), a nonpartisan seniors' group, was also critical of the payment increase. Executive director Shannon Benton said in a statement that the COLA "falls short of expectations" and that benefits lag behind price spikes because seniors don't see the adjustment until January. AARP analysis released this week found that 76% of adults 50 and older said a COLA of around 3.5%, slightly lower than the announced figure, would not be enough to help them keep up with rising prices.