Millions of Americans rely on Social Security benefits for their everyday survival. These include retirees, survivors, and millions of disabled people. For these people, even a slight gain in benefits could make a lifetime of difference.
Many of those who receive Social Security benefits can expect a modest boost in their social security checks next year. This boost will come from a projected cost-of-living adjustment (COLA) of about 2.7%, beginning in January 2026.
Even if for many retirees it means slightly more in monthly benefits, it could raise certain check values up to $5,246. However, the fresh concern among recipients is that rising Medicare costs and inflations may eat up all the gains in the amount.
The inflation data and analysis are based on groups like the Senior Citizens League. According to these, a 2.7% COLA would be applicable in the coming year and that would mean an average of $54 extra per month for retirees. Currently, the typical monthly payments hover around $2,006. This rise would bring the total to between $2,060 and $2,090 per month.
There is a small group of retirees that draws the maximum benefit. These are those people who retired at the age of 70 and claimed their benefits after waiting until the last stage of eligibility.
For such people, the projected check amount is somewhere nearly $5,108. After COLA in 2026, the amount will be adjusted to $5,246 which will lead to the annual boost of $1,656.
This increase in Social Security benefits is, of course, welcome but it comes with a catch. In the coming few months, there is an expected increase in Medicare Premium. If the premium is increased along with the rise in benefits, all the alleviated amount will be eaten by the premium payments.
Recipients who pay Medicare premium, have it deducted from the social security checks. Therefore, in light of these developments, they may get a very negligible raise in their monthly checks or no raise at all.
If the projected increase in benefits is less than the Medicare premium hike, they may end up with checks that are a few dollars short.
Economists have again warned that COLA calculations are based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI_W). However, this may not be the right mode of calculation but it may not be the right mode of calculator since it does not consider the rise in prices of healthcare, housing, and food.
These rising costs could further eat up the gains from the COLA adjustment.
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Those who are dependent on Social Security must keep the timeline in mind.
- The Social Security Administration (SSA) will officially calculate COLA using inflation data from July-September 2025 (CPI-W).
- The new benefits and rise in benefits will begin in January 2026
- Supplemental Security Income (SSI) recipients will also see increases around the same time.
For beneficiaries, this expected COLA means a modest relief. It also gives them a bit more breathing room. But for many, it’s far from enough. With rising costs across essentials, extra dollars may vanish more quickly than they hope.
