Social Security Announces 2.8% COLA for 2026

The Social Security Administration announced a 2.8% cost-of-living adjustment for 2026, raising average benefits by about $56 a month and taking effect in January (SSI recipients receive the increase on Dec. 31, 2025). The COLA — based on third-quarter CPI‑W data — will benefit roughly 71–75 million Social Security recipients and about 7.5 million Supplemental Security Income beneficiaries, and the taxable earnings cap subject to Social Security payroll tax will rise to $184,500 in 2026. The announcement was delayed by the recent federal government shutdown. Analysts warn that a projected jump in Medicare Part B premiums — trustees estimate an 11.6% increase — along with rising health, housing and utility costs could absorb much or all of the boost for many beneficiaries. SSA officials say COLAs help preserve benefit value but cannot solve broader retirement shortfalls, and advocates say the modest adjustment leaves many older Americans financially vulnerable.