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2026 Social Security COLA Projected at 2.4%, Lowest Increase in Five Years

Analysts caution the preliminary estimate may change due to inflation trends, tariffs, and new prescription drug pricing policies.

The logo of the US Social Security Administration is seen outside a Social Security building, November 5, 2020, in Burbank, California.
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On average, a retiree could see an extra $150 a month -- if there's a 9% cost of living adjustment to Social Security for 2023 -- on top of current benefits at $1,656 a month. That would be an additonal $1,800 a year. Xxx Img Social Security 1 1 Av112ud9i Jpg

Overview

  • The 2026 Social Security cost-of-living adjustment (COLA) is preliminarily estimated at 2.4%, based on April's CPI-W data, marking the smallest increase since 2021.
  • The official COLA will be determined in October using inflation data from July through September, leaving room for potential adjustments.
  • Tariffs imposed by the Trump administration could raise inflation later this year, potentially impacting the final COLA calculation.
  • Prescription drug prices rose 2.3% year-over-year through April, moderated by Inflation Reduction Act provisions requiring rebates for price increases above inflation.
  • President Trump's recent executive order linking U.S. drug prices to international rates introduces uncertainty about its impact on consumer costs and retirees' budgets.