The Cost of Living Adjustment is one of the most useful tools for all United States Social Security beneficiaries. Thanks to this tool, the U.S. Government makes sure that retirees’ benefits are not too small in the following years. Inflation never stops, which is why it is so important to have the COLA every year.
Well, if we take all this into account, we can find that citizens who collect a Social Security check can enjoy extra money each year to deal with inflation. Millions of citizens get only a Social Security retirement payment and without a COLA increase to balance the scales, they will not be able to live well.
How much will the Social Security COLA increase in 2026?
The Federal Reserve makes the checks increase based on the COLA. And this makes citizens have a little faith about these benefits. However, all indications are that in 2026 there will not be a new payment with an overly large COLA, so we are looking at a very small increase over previous years.
In total, the COLA has caused Social Security payments to increase by about 19% over the past three years, but it still all seems insufficient if we look at inflation. In the next year it looks like we will see 2.5%, although it is still too early to talk about an official date.
As everything is directly dependent on inflation we find that we may not see a higher COLA in 2026. Even if prices are maintained and inflation causes them to rise a little even, the truth is that it will not go beyond the current inflation in 2025, so in 2026 we could see a lower COLA than in the next year.
While these are all assumptions, what is certain is that the Fed has spoken with objective data about inflation and previous years. Therefore, we might have some faith about encountering this type of COLA soon, even if it seems insufficient for Social Security beneficiaries.