Social Security beneficiaries could see their largest annual cost-of-living increase in three years, according to fresh estimates built on the latest government inflation data. Projections for the 2027 adjustment now cluster around 3.5% to 3.6%, CNBC reported.
That range would top the 2.8% boost that roughly 75 million Social Security and Supplemental Security Income recipients received for 2026, according to the Social Security Administration.
Where the estimates stand
Independent Social Security and Medicare policy analyst Mary Johnson pegs the 2027 COLA at 3.5%, incorporating the consumer price index figures released Friday. That is a slight bump from her August estimate of 3.4%.
Johnson said the path of the projection from here hinges on volatile oil prices, which have played an outsized role in inflation since the Iran war began.
The Senior Citizens League, a nonpartisan senior advocacy group, now projects a 3.5% COLA — down a notch from the 3.6% it estimated a month earlier. At that level, the group calculates the average monthly benefit check would rise by $67.90.
AARP, meanwhile, moved in the opposite direction. The nonprofit representing Americans age 50 and older said Friday it now forecasts a 3.6% COLA for 2027, up from its 3.5% August estimate. That would translate to about $75 more per month for the average retired worker.
Why the number moves around
The official figure will not be locked in until one more month of inflation data arrives. The Social Security Administration typically announces the following year’s adjustment in October.
The COLA is calculated from the percentage increase in third-quarter inflation data compared with the same period a year earlier. The underlying index is a subset of the consumer price index called the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W.
According to Bureau of Labor Statistics data released Friday, CPI-W rose 3.5% over the 12 months through August. The broader consumer price index was up 3.4% over the same stretch as the cost of goods and services climbed during the month.
Because the calculation draws on a narrower basket than headline inflation, the two measures can drift apart — and the gap matters for how the final adjustment lands.
Historical context
Over the past decade, the COLA has swung from 0% in 2016 to 8.7% in 2023, the steepest increase in four decades, driven by surging inflation. The Social Security Administration said in October that the adjustment has averaged about 3.1% over the past 10 years.
A 2027 increase in the mid-3% range would sit above that recent average but well below the pandemic-era spike. For retirees managing fixed incomes, the difference between a 3.5% and 3.6% adjustment amounts to a few dollars a month — but the estimate has been in flux as energy markets and inflation data shift.
With one more CPI reading still to come before the fall announcement, the final number could move in either direction. Analysts will be watching oil prices in particular, given their recent influence on the inflation readings that feed the formula.
Source: www.cnbc.com — https://www.cnbc.com/2026/09/11/social-security-cola-2027-estimate.html
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