Social Security COLA for 2027 may be 3.5% to 3.6%, new estimates show — the highest in 3 years

People shop for groceries at a supermarket in Manhattan on Aug. 25, 2026 in New York City.

Angela Weiss | AFP | Getty Images

The Social Security cost-of-living adjustment for 2027 may be around 3.5% to 3.6%, according to new estimates based on government inflation data — which would push the annual adjustment to the highest in three years.

In 2026, around 75 million Social Security and Supplemental Security Income beneficiaries saw a 2.8% boost to their benefits, according to the Social Security Administration.

The Social Security COLA for 2027 may be 3.5%, factoring in the latest consumer price index data released on Friday, according to Mary Johnson, an independent Social Security and Medicare policy analyst. In August, Johnson had estimated the COLA may be 3.4%.

Johnson said how the projected COLA might change will depend on volatile oil prices. Oil prices have had a significant impact on inflation since the war began.

Read more CNBC personal finance coverage

Bond sell-off, stock boom: Why rebalancing is a good strategy right now

Trump's proposed $5,000 election dividend checks may fuel inflation: Economists

Social Security COLA for 2027 may be highest in 3 years, new estimates find

Trump announces $500 Obamacare refunds for nearly 1 million people

CNBC's Financial Advisor 100: Best financial advisors, top firms ranked

CNBC Elite Advisors: Top ultra-high net worth wealth management firms for 2026

The Senior Citizens League now projects a 3.5% Social Security COLA, down from the 3.6% increase it had projected last month. That latest estimate would increase average monthly benefit checks by $67.90, according to the nonpartisan senior group.

Meanwhile, the AARP now forecasts a 3.6% Social Security COLA for 2027, which would increase the average retired worker's benefit by $75 per month, the nonprofit representing Americans age 50 and over said on Friday. That is up from the 3.5% COLA the AARP had estimated in August.

In the past decade, the Social Security COLA has ranged from 0% in 2016 to 8.7% in 2023, the highest increase in four decades, due to rising inflation. The COLA has averaged about 3.1% over the past 10 years, the Social Security Administration said in October.

When to expect Social Security 2027 COLA news

The official Social Security COLA for 2027 will include one more month of government inflation data. The Social Security Administration typically announces the following year's change in October.

The Social Security COLA is determined by the percentage increase in third-quarter inflation data from the prior year to the current year.

The calculation is based on a subset of the consumer price index, known as the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W. The CPI-W increased 3.5% over the past 12 months, according to data released by the Bureau of Labor Statistics on Friday.

The broader consumer price index was up 3.4% over the past 12 months as the cost of goods and services climbed in August.

watch now