We're Exactly One Month Away From This Major Social Security Announcement

If you are a retiree who gets a Social Security check, you may see an increase in the amount of your check, depending on the cost-of-living adjustment for 2027. Each year, the Social Security Administration assesses inflation data to decide what the cost-of-living adjustment, also known as COLA, will be. The goal is to increase retirees' income to keep up with the rising cost of goods.

Though retirees will differ in how much this COLA update will impact their day-to-day cash flow, many people appreciate the extra money each month, especially if it helps them afford basic expenses, like groceries. Here is what retirees need to know about the cost-of-living adjustment, when it will be, and what some people are suggesting the percentage increase will be.

When the Social Security COLA will be announced

The Bureau of Labor Statistics will release the Consumer Price Index report on October 14, 2026. These numbers will include key inflation data that the Social Security Administration needs to calculate the final Social Security COLA. Once the SSA has the inflation data, retirees can expect to get the COLA increase information that day or shortly thereafter. However, the increase won't take effect until January 2027.

The COLA considers specific inflation data

It's likely that you've read inflation news in the headlines. However, the Social Security Administration doesn't always use the figures that you read about online. Rather, they use the CPI-W, which is the Consumer Price Index for Urban Wage Earners and Clerical Workers. They compare the third-quarter numbers to the previous year to determine the cost-of-living percentage increase. Even though we don't have the exact numbers yet, some groups are still forecasting specific increases to Social Security.

The 2026 Social Security benefits increase

In 2026, the COLA increase was 2.8%. In 2025, by comparison, it was 2.5%. The SSA reports that the average retired worker received just over $2,000 a month in 2026. However, many people believe that the 2027 COLA increase will be more than in 2026. A larger increase could mean bigger checks for many retirees. This is important for retirees who rely solely on Social Security as a way to afford groceries, utilities, and other necessary expenses.

Current predictions for the 2027 COLA

The AARP predicts that the COLA for 2027 will be 3.5%, based on inflation data so far. This could equate to an additional $73 per month on average for retired workers (or $876 a year). The Senior Citizens League, another group, says it expects a 3.6% increase in the cost of living. Of course, retirees won't know the actual number until the official Social Security Administration information comes out. Additionally, $73 is an average. Those who typically receive smaller checks will have less of an increase.

Retirees will likely still need to supplement Social Security with other income

Because the average Social Security check is just over $2,000, retirees will likely need to supplement that with other income, especially if they have housing costs, like a mortgage or rent. Having additional income, such as a pension, 401(k) withdrawals, or even part-time work, can help retirees improve their cash flow. Those $73 extra a month would be helpful from a cash flow perspective; it may not cover increasing expenses, like healthcare costs.

Retirees may also see increasing Medicare Part B costs

Many retirees have to pay for Medicare Part B premiums, and these premiums typically come out of Social Security checks. In 2026, the standard Part B premium is $283 per month. However, Medicare Part B premiums have risen over the last two years, so retirees can reasonably expect that those premiums may rise again. Because of that, retirees should know that even if their Social Security checks increase because of a cost-of-living adjustment, an increasing Medicare Part B premium can reduce the impact of that increase.

Many retirees will feel like the adjustment is not enough to cover their living expenses

Because retirees have different living expenses, housing costs, income streams, and healthcare needs, some may feel like the COLA increase is helpful, while others may feel like it's not enough. Having a larger Social Security check doesn't necessarily mean that retirees will be better off financially. What really matters is how retirees spend the money they have. Setting up a budget, managing spending, and having an emergency fund for unexpected expenses can go a long way in helping retirees to improve their cash flow.

Bottom line

Even though a new cost-of-living update is coming soon, it may not have a big impact on retirees. That's because the Medicare Part B premiums may also increase, reducing the amount that retirees will see. Retirees may benefit from having multiple streams of income to earn extra money, like getting a part-time job.

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