A man walks in front of the dairy section of a supermarket in Houston, Texas, on March 17, 2026.
Ronaldo Shemit | AFP | Getty Images
New government data showing rising inflation suggests a rise in Social Security cost-of-living adjustments in 2027, according to new forecasts.
Mary Johnson, an independent Social Security and Medicare policy analyst, said Social Security’s COLA could reach 4.2% as gasoline, energy and fresh food prices “rise sharply.”
Johnson’s new forecast is based on April consumer price index data published on Tuesday and is an upward revision from the 3.2% COLA forecast for 2027 that Johnson predicted last month.
Meanwhile, the Senior Citizens League, a nonpartisan senior citizen organization, currently estimates that the COLA could be 3.9% in 2027. This is higher than the 2.8% annual increase the organization had predicted in April.
COLA forecasts are higher as consumers continue to face price pressure. Mr Johnson said prices in categories such as household heating oil, tomatoes, petrol, coffee and fresh vegetables had risen over the past 12 months.
The National Federation of Senior Citizens estimates that Social Security benefits have lost 13.7% of their purchasing power since 2016, and would need a 15.7% increase, or $295.85 per month for the average recipient, to replace it.
In contrast, the Federation on Aging’s current 3.9% COLA projection would increase the average retiree’s benefit check by an estimated $81.17 per month.
Inflation in April exceeded expectations
New data shows the broader consumer price index rose 3.8% in the past 12 months, the highest rate of increase since May 2023, as prices for certain goods and services rose faster than expected.
Meanwhile, the Consumer Price Index for Urban Wage and Office Workers (CPI-W), which is used to calculate Social Security COLAs, rose 3.9% over the past 12 months, according to April data.
Social Security benefits increased 2.8% in 2026 for approximately 75 million beneficiaries. Over the past 10 years, the average annual COLA was 3.1%, according to the Social Security Administration.
2027 Social Security COLA projections are subject to change.
Each year, the Social Security Administration calculates the COLA by comparing third quarter CPI-W data to the previous year’s third quarter data. If there is an increase from one year to the next, that determines your COLA.
Next year’s changes are typically announced by the agency in October, so we’ll receive five more months of inflation data before the official calculation of the 2027 Social Security COLA.
