Overview
- The Social Security Administration, which announced the change on Oct. 14, set the 2027 cost‑of‑living adjustment at 3.6 percent for benefits paid beginning in January 2027.
- The COLA is calculated from the Bureau of Labor Statistics’ CPI‑W for July through September, with September’s reading determining the size of the increase.
- The average beneficiary will see a modest rise in monthly checks — roughly $75 a month at current averages — but Part B Medicare premiums and higher health outlays are often withheld from benefits and can erase much of that gain.
- Analysts and consumer guides note two additional Social Security program changes that could affect when and how people claim benefits and advise recipients to review mailed notices due in December and online statements posted in late November.
- Longer term, Social Security faces financing pressure: trustees project trust‑fund shortfalls in the early 2030s and critics say the CPI‑W understates retirees’ real health cost exposure, raising questions about whether nominal COLAs will protect living standards over time.