There’s already bad news for the 2027 COLA — what Social Security recipients should know

Social Security benefits got a 2.8% raise for 2026, which is higher than last year’s increase, according to the Social Security Administration. Many seniors were not very happy with this raise because 2.8% is still small, especially since Medicare Part B costs also went up this year, as reported by The Motley Fool. Now there is early bad news for 2027, because the Senior Citizens League has released its first prediction for next year’s COLA.

The 2027 COLA is currently projected at 2.5%, based on early inflation data, according to the Senior Citizens League. This 2.5% estimate is lower than the 2026 COLA and much smaller than the big increases seen after the COVID-19 pandemic. Experts warn this number can change a lot, because Social Security COLAs are based only on inflation data from July to September.

2027 COLA still not final

Since it is only January, the final 2027 COLA is still unknown, and current estimates should not be taken too seriously, said The Motley Fool. Groups like the Senior Citizens League release monthly estimates to give seniors a rough idea of what may happen. Even so, many experts say future COLAs will likely stay weak, no matter the final number for 2027.


The main problem is how COLAs are calculated, because they use inflation data for urban workers, not retirees. Retired people spend more on healthcare and housing, which rise faster than general worker expenses, making COLAs less helpful. Because of this flaw, seniors often lose buying power over time, even when they receive yearly COLA increases.

Ways seniors can earn more

Retirees who are worried about 2027 are being told to find small ways to earn extra money. This could mean doing a part-time job or simple work for a few hours a week. Another idea is renting out a spare room in your home to help pay for rising costs, though it may be uncomfortable, according to The Motley Fool.

People who are still working are advised to save more money for retirement now. Experts warn that Social Security alone will not be enough to cover all expenses. They also say many retirees miss easy Social Security tips. Learning how to get the maximum benefit can add thousands of dollars each year and make retirement feel safer.

FAQs

Q1. What is the expected Social Security COLA for 2027?

The early estimate suggests a 2.5% COLA, but the final number will depend on inflation later in the year.

Q2. Why are Social Security COLA increases often not enough?

Because COLAs are based on worker inflation data, they do not fully cover rising healthcare and housing costs for retirees.