M Swiet Productions | Getty Images
The Social Security cost-of-living adjustment for 2026 is projected to be the lowest increase that millions of beneficiaries have seen in recent years.
This could change, however, due to potential inflationary pressures from tariffs.
Recent estimates for the 2026 COLA, based latest government inflation data, place the adjustment to be around 2.2% to 2.3%, which are below the 2.5% increase that went into effect in 2025.
The COLA for 2026 may be 2.2%, estimates Mary Johnson, an independent Social Security and Medicare analyst. Meanwhile, the Senior Citizens League, a nonpartisan senior group, estimates next year’s adjustment could be 2.3%.
If either estimate were to go into effect, the COLA for 2026 would be the lowest increase since 2021, when beneficiaries saw a 1.3% increase.
As the Covid pandemic prompted inflation to rise, the Social Security cost-of-living adjustments rose to four-decade highs. In 2022, the COLA was 5.9%, followed by 8.7% in 2023 and 3.2% in 2024.
The 2.5% COLA for 2025, while the lowest in recent years, is closer to the 2.6% average for the annual benefit bumps over the past 20 years, according to the Senior Citizens League.
To be sure, the estimates for the 2026 COLA are indeed preliminary and subject to change, experts say.
More from Personal Finance:
Here’s the inflation breakdown for March 2025 — in one chart
Don’t miss these tax strategies during the tariff sell-off
Selling out during the market’s worst days can hurt you
The Social Security Administration determines the annual COLA based on third-quarter data for Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W.
New government inflation data released on Thursday shows the CPI-W has increased 2.2% over the past 12 months. As such, the 2.5% COLA is currently outpacing inflation.
Yet that may not last depending on whether the Trump administration’s plans for tariffs go into effect. Trump announced on Wednesday that tariff rates for many countries will be dropped to 10% for 90 days to allow more time for negotiations.
Tariffs may affect 2026 Social Security COLA
If the tariffs are implemented as planned, economists expect they will raise consumer prices, which may prompt a higher Social Security cost-of-living adjustment for 2026 than currently projected.
“We could see the effect of inflation in the coming months, and it could very well be by the third quarter,” Johnson said.
If that happens, the 2026 COLA could go up to 2.5% or higher, she said.
Retirees are already struggling with higher costs for day-to-day items like eggs, according to the Senior Citizens League. Meanwhile, new tariff policies may keep food prices high and increase the costs of prescription drugs, medical equipment and auto insurance, according to the senior group.
Most seniors do not feel Social Security’s annual cost-of-living adjustments keep up with the economic realities of the inflation they personally experience, the Senior Citizens League’s polls have found, according to Alex Moore, a statistician at the senior group.
“Seniors generally feel that that the inflation they experience is higher than the inflation reported by the CPI-W,” Moore said.
When costs are poised to go up and the economic outlook is uncertain, seniors may be more likely to feel financial stress because their resources are more fixed and stabilized, he said.