Washington, D.C., October 26, 2025
News Summary
The Social Security Administration has revealed a 2.8% cost-of-living adjustment (COLA) effective January 2026, allowing an average monthly raise of over $56 for around 71 million beneficiaries. Supplemental Security Income (SSI) recipients will see their increases starting December 31, 2025. While this adjustment aims to assist seniors amid rising living costs, concerns remain regarding its sufficiency against inflation and other economic challenges faced by the elderly population.
Washington, D.C. – The Social Security Administration has announced a 2.8% cost-of-living adjustment (COLA) that will take effect beginning January 2026. This increase will provide an average monthly raise of over $56 for nearly 71 million Social Security beneficiaries. In addition, approximately 7.5 million individuals receiving Supplemental Security Income (SSI) will see their payment increases begin earlier, on December 31, 2025.
This COLA announcement experienced delays due to a federal government shutdown. The adjustments are fundamentally designed to help seniors and other beneficiaries cope with rising costs of living, reflecting current economic conditions.
The increase in benefits will be financed through payroll taxes collected from both workers and employers. In conjunction with the COLA, the annual salary cap for 2026 is set to rise from $176,100 in 2025 to $184,500.
In terms of context, Social Security recipients received a 2.5% increase in 2025, following a 3.2% increase in 2024. Prior to that, the year 2023 saw a substantial 8.7% adjustment, primarily due to the high inflation rates experienced during that period. The 2.8% adjustment for 2026 indicates a trend of moderating inflation but raises questions about whether it will sufficiently address the rising costs that many seniors face.
Concerns Among Seniors
Despite the announcement of the COLA, many seniors are expressing concerns that this increase may not adequately address their everyday expenses. A recent AARP poll revealed that only 22% of Americans above the age of 50 believe a 3% increase is enough to keep pace with increasing prices. Meanwhile, a significant 77% disagreed with that sentiment, regardless of their political affiliation.
A case in point is an 80-year-old retiree from South Carolina, who highlighted the financial strain of increasing monthly rent and healthcare costs, indicating that the COLA adjustment is not keeping up with current living expenses. The MIT Living Wage Calculator estimates that annual housing, medical, and food costs for a single adult in areas like Florence, SC, exceed $17,000.
Financial Challenges Ahead
The AARP CEO noted that while the COLA adjustments are essential for maintaining independence for many seniors, numerous individuals still struggle to cover their basic costs. The Social Security Administration’s Commissioner emphasized that the COLA reflects the economic realities faced by recipients.
However, the measures undertaken through COLA adjustments may not alleviate all financial burdens faced by retirees. The Bipartisan Policy Center’s director pointed out the limited capacity of COLA adjustments to resolve various financial challenges.
Future of Social Security
The Social Security Administration is currently facing its own set of challenges, including workforce reductions and uncertainty regarding the program’s long-term viability. As reported in June 2025, Social Security’s trust funds may not be able to fully pay out benefits starting as early as 2034. This brings significant concerns over the adequacy of benefits for low-income seniors and the potential for increased poverty risks among older Americans.
Looking forward to 2026, the Standard Medicare Part B premium is also likely to rise, which could diminish the impact of the COLA increase. Economists anticipate that inflation may surpass 3% in 2026, potentially further impacting the fixed incomes of these seniors. Historically, the average COLA over the last decade has been 3.1%, making the 2.8% increase for 2026 notably less robust.
Seniors may be urged to explore alternative options for Medicare or prescription drugs due to anticipated rising costs and fewer available choices. Additionally, concerns surface regarding the over 120,000 seniors living below the poverty line in states like Washington.
COLA Calculation Overview
The COLA calculation is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Nonetheless, discussions are underway advocating for the use of the CPI-E (Consumer Price Index for the Elderly), which more accurately reflects the cost experiences of seniors.
Summary Chart
| Year | COLA Increase | Average Monthly Raise | New Salary Cap |
|---|---|---|---|
| 2024 | 3.2% | Varies | N/A |
| 2025 | 2.5% | Varies | $176,100 |
| 2026 | 2.8% | $56+ | $184,500 |
FAQ
When will the 2.8% COLA increase be applied?
The 2.8% COLA will take effect in January 2026 for Social Security recipients, while Supplemental Security Income recipients will see increases starting on December 31, 2025.
What factors determine the COLA adjustment?
The COLA adjustment is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which tracks changes in the prices of goods and services typically consumed by seniors.
How does the COLA impact seniors living on fixed incomes?
While the COLA increase provides some financial relief, many seniors report that it does not adequately cover rising expenses such as housing, healthcare, and food costs.
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HERE Resources
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Additional Resources
- Kitsap Sun: Washington State Seniors Get 2.8% Increase in 2026 Social Security COLA
- Washington Post: Social Security COLA Increase Benefits
- WTOP: Social Security Recipients Get a 2.8% Cost of Living Boost in 2026
- King 5: Social Security Cost of Living Adjustment 2026 Revealed
- Daily Record: Social Security Recipients Will Get a 2.8% Cost of Living Boost in 2026
- Wikipedia: Social Security
- Google Search: Social Security COLA 2026
- Google Scholar: Social Security
- Encyclopedia Britannica: Social Security
- Google News: Social Security COLA Increase
Author: STAFF HERE FLORENCE WRITER
The FLORENCE STAFF WRITER represents the experienced team at HEREFlorence.com, your go-to source for actionable local news and information in Florence, Florence County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Florence Festival of Lights, Pee Dee Pride, and agricultural expos at the Florence Center. Our coverage extends to key organizations like the Florence Regional Chamber of Commerce and the Pee Dee Area Council of Governments, plus leading businesses in healthcare and retail that power the local economy such as McLeod Health and Pee Dee Electric Cooperative. As part of the broader HERE network, including HERECharleston.com, HEREColumbia.com, HEREGreenville.com, and HEREHiltonHead.com, we provide comprehensive, credible insights into South Carolina's dynamic landscape.
