The Social Security Administration (SSA) will announce in October the percentage increase in the COLA, Cost of Living Adjustment. This is a percentage increase in social security benefits, which is driven by inflation. U.S. Social Security ensures fairness in the contributions of beneficiaries, adjusting payments according to the country’s current inflation.
Those receiving welfare benefits such as Supplemental Security Income (SSI), Supplemental Security Disability Insurance (SSDI), retirees or widow(er)s will see an increase in the amount of their benefits in 2026. The COLA percentage is calculated by comparing the third quarter CPI-W to the previous year. The Senior Citizens League estimates that the percentage for 2026 will be around 2.5%, but we will have to wait until October for official figures and January 2026 for implementation.
SSA’s Work
Many U.S. citizens receive benefits from the Social Security Administration (SSA). The SSA ensures economic fairness for beneficiaries by making financial assistance available to those who need it. For many of them, these benefits are their only source of income, so their importance is vital. SSA offers a wide range of benefits, including:
- Supplemental Security Income (SSI).
- Second Disability Insurance (SSDI).
- Widow’s, survivors’ and disability benefits.
How are the aid amounts calculated?
Social Security benefits depend on several factors. Each has its own eligibility criteria that the beneficiary must meet in order to receive it. However, there is also a percentage that corresponds to the COLA; Cost of Living Adjustment. What is the function of this percentage? The COLA depends on the inflation rate of the country, so the amount of the aid is adjusted with respect to the price of the costs of basic services, food and medication. How is it calculated?
Easy. To calculate the COLA percentage to be applied for the next fiscal year, the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) is used. Specifically, the SSA compares the data for the third quarter of the current fiscal year, and compares it to that of the previous year. The percentage increase generated will be applied to the next COLA.
2026 COLA
The Social Security Administration (SSA) announces the COLA percentage to be applied the following fiscal year in October. In other words, the official figures for the 2026 adjustment will be known in October 2025 and will not go into effect until January 2026. However, estimates can be made. The Senior Citizens League (TSLC) has published an estimated COLA rate of about 2.5% for 2026. It should be emphasized that this is not an official figure, but if it is, it would be practically the same as the percentage applied in 2025. How is this increase reflected in benefit payments? Depending on the social assistance received, the following changes are expected to occur:
- In the case of retirees, they would increase the amount of their monthly payment from $1,976 to $2,025. In the case of a couple, the increase would be from $3,089 to $3,166. These are estimated figures that would also vary depending on the income and years contributed by each beneficiary.
- In the case of SSI, there would also be an increase. The amount would go from $967 to $991 if it is a single individual, and from $1,450 to $1,486 if it is a couple.
Aspects to be taken into account
The figures provided are only estimates and estimates. There are many factors that are taken into account when modifying the amounts received by the beneficiaries, such as working life, years of contributions or current income. Therefore, although the COLA percentage is estimated in one figure, each person will see how it varies according to his or her data. We will have to wait until October 2025 to know the official amount declared by the Social Security Administration for the following year 2026.
Social Security will start reducing benefits as of July. Find out if you are one of those affected!