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Retirement

Social Security

2026 Social Security COLA: Here's How Much Payments Will Rise Next Year

Photo-illustration of a social security card sitting in a pile of money

Money; Getty Images

Social Security beneficiaries will receive a 2.8% increase in their monthly payments for 2026, the Social Security Administration announced Friday after a nine-day delay due to the government shutdown.

The annual cost-of-living adjustment, or COLA, is designed to help Social Security recipients keep up with rising prices. The 2026 COLA news means that the more than 72 million Americans who receive benefits will take in $56 more per month, on average, according to the announcement.

"Social Security is a promise kept, and the annual cost-of-living adjustment is one way we are working to make sure benefits reflect today’s economic realities and continue to provide a foundation of security," Social Security Administration Commissioner Frank Bisignano said in a release.

About 60 million Americans receive these retirement benefits, and 8 million beneficiaries get disability insurance. About 7 million Americans receive Supplemental Security Income, or SSI, which is intended to help adults and children with little to no income and resources who are blind, disabled, or age 65 and up. (Some folks receive both SSI and Social Security.) The 2.8% increase applies to all of these programs.

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The 2026 COLA is slightly larger than the 2.5% adjustment for 2025. That's the good news. However, inflation is rising again, and advocacy groups say that the government's methodology for calculating COLAs hasn't fully captured real inflation, resulting in a loss of purchasing power over time.

Here's what you need to know about the 2026 Social Security COLA:

How much will Social Security benefits increase in 2026?

The average Social Security retirement payment will increase by $56 on Dec. 31, according to a fact sheet published Friday. That will bring the typical monthly payment for retired workers up to $2,071 in January.

For comparison, the average Social Security retirement payment increased by $49 with the 2025 COLA.

In a statement Friday, AARP CEO Myechia Minter-Jordan said the COLA plays "a crucial role in supporting older Americans, helping ensure retirement income keeps pace with inflation." The COLA protects folks' hard-earned benefits at a time when "many older Americans have been financially squeezed," she added.

When will the 2026 COLA take effect?

The 2026 COLA will show up in payments on and after Dec. 31 (when the SSI payment for January is scheduled to be distributed).

The full 2026 Social Security payment schedule can be found on the Social Security Administration's website.

How was the Social Security COLA calculated?

The annual benefit adjustment is based on inflation data from the third quarter, spanning July, August and September. The COLA calculation uses the consumer price index for urban wage earners and clerical workers, the CPI-W.

The math is relatively simple. The CPI-W was 316.349 in July, 317.306 in August and 318.139 in September. The average for those months (317.265) compares to last year's third-quarter average of (308.729). That difference, 8.536 (or 2.8%), is the COLA.

Why was the COLA announcement delayed?

Due to the government shutdown, the Bureau of Labor Statistics was forced to pause work on the September consumer price index (CPI) report, which was the final piece of the COLA calculation.

Earlier in the month, the bureau brought back some staff to resume work on the CPI so the Social Security Administration could "meet statutory deadlines necessary to ensure the accurate and timely payment of benefits," according to the BLS. The report came out Friday morning, so beneficiaries are now getting clarity on their 2026 benefits.

How does the 2026 COLA compare to past COLAs?

Over the last decade, the typical COLA has been about 3.1%, but over the past 20 years, it's come in around 2.6%.

Advocacy groups say that beneficiaries have not gotten adequate cost-of-living raises in recent years.

"COLA might reflect the inflation rate, but it is woefully insufficient for older Americans who already have high health care costs and are facing even greater increases in their Medicare costs in 2026," Ramsey Alwin, president and CEO of the National Council on Aging, said in a statement Friday.

Some blame the CPI-W-based formula. Instead, groups like The Senior Citizens League say, benefits should be adjusted based on a different inflation index for the elderly, the CPI-E. That experimental index is meant to more accurately track the rising costs of items that older Americans spend their money on.

That's just one of the many Social Security reforms that have been proposed — but not enacted — in recent years.

The one recent policy change of note: In July, Congress created a new, temporary $6,000 tax deduction for people 65 and older under certain incomes.

The Trump administration has tried to argue that this provision means the president delivered on his "no tax on Social Security" promise. However, while the measure does reduce Americans' tax liabilities, it does not fully eliminate tax on Social Security — far from it, experts say.

One other potential issue: This year, the timing of the COLA announcement may be less than ideal for beneficiaries. The third-quarter inflation data that determines the COLA only captured the initial impact of heightened tariffs. U.S. trade policy is quickly developing, and if inflation ticks back up this winter, Social Security beneficiaries could end up feeling that the COLA was insufficient.