On October 14, the Social Security Administration (SSA) will announce the 2027 cost-of-living adjustment (COLA). It’s designed to help Social Security beneficiaries maintain their purchasing power by increasing benefits when consumer prices rise.
According to an article by The Street, when calculating the COLA, the SSA doesn’t average inflation over the entire year but rather only figures from the third quarter — July, August and September.
The COLA formula is based on the average Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). It compares third quarter figures to the third-quarter average from the previous year. If prices have increased, then Social Security beneficiaries receive a COLA reflecting that change.
As a result, the inflation readings released over the summer are the most important ones to look at. The article points out that even modest changes in inflation during July, August, or September could move the final COLA estimate higher or lower.
CNBC reports that after reviewing July inflation data, experts are predicting a 3.4-to-3.6 percent COLA. That’s lower than earlier estimates, but still higher than this year’s 2.8 percent COLA.
Council of Seniors Is Here To Help Older Americans
All of us here at the Council of Seniors want to improve retirees’ financial futures and ensure they receive their full Social Security benefits. We are working with members of Congress to introduce the “Social Security Restitution Act.” It would provide an estimated $970 one-time payment to every retired worker receiving Social Security benefits, to help offset years of inadequate cost-of-living adjustments.
According to Council of Seniors’ Executive Director Barbara Godwin, “For years, seniors have watched their Social Security checks fail to stretch as far as they should, while the cost of everyday essentials keeps climbing. This legislation is a straightforward, targeted way to help make up for COLAs that didn’t reflect what retired Americans were actually paying to get by.”
Please take a moment and sign our petition today to show your support.