2026 Social Security COLA forecast lowered to 2.2%

Social Security provides important financial support for retirees. However, many seniors feel their benefits do not keep up with rising inflation. A survey from last year showed that most retired workers believe the cost-of-living adjustments (COLAs) in 2024 and 2025 were not enough. The Senior Citizens League has updated its forecast for the 2026 COLA to only 2.2%. This is a decrease from previous estimates and the smallest increase since 2021. The COLA is supposed to help retirees cope with inflation, but the way it is calculated may not accurately reflect their spending habits. COLAs are based on a measure called the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This index tracks price changes that affect hourly workers. Unfortunately, working adults often spend money differently than retirees, who typically focus more on housing and medical care. Recent data shows that while overall CPI-W inflation dropped to 2.7% in February, housing prices increased by 3.7% and medical care costs went up by 2.9%. In contrast, expenses like education and transportation did not rise as quickly, which might misrepresent the financial pressures faced by seniors. It is important to remember that the official COLA for 2026 won’t be determined until October 2025. Until then, the inflation trends may change. However, as it stands, the projected 2.2% COLA could mean that Social Security benefits lose buying power for retirees who rely on them to cover essential living costs.