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The Social Security cost-of-living adjustment (COLA) has become a cornerstone of economic stability for millions of retirees and people with disabilities in the United States. Designed to offset the effects of inflation, this annual increase seeks to ensure that the purchasing power of benefits is maintained over time.
The Social Security Administration (SSA) is responsible for determining this adjustment, a task it performs using a formula that takes into account the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a key measure of price movements in the economy.
In this regard, it is important to be aware of the calendar and know when the benefits will arrive.
Who can receive COLA benefits with Social Security?
These are the people who can receive COLA benefits:
- Retired workers.
- Disabled workers.
- Survivors of deceased workers.
- Those who receive Supplemental Security Income (SSI).
What will happen on October 15 for Social Security beneficiaries?
The Social Security Administration (SSA) will announce the highly anticipated Cost of Living Adjustment (COLA) for 2026.
How is Social Security COLA calculated?
The Social Security Administration (SSA) uses the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) to determine the Cost of Living Adjustment (COLA) percentage each year.
This is how the COLA calculation is performed:
- Data from the CPI-W for the third quarter (July, August and September) of the current year is averaged.
- The average for the third quarter of the current year is compared with the average for the third quarter of the previous year.
- Next year's COLA is set at the percentage increase between the two averages.