Blow for United States retirees: Watch out for the SSA in 2026, expect the worst

Retirees in the United States face a concerning outlook for 2026. Experts warn that the cost-of-living adjustment (COLA) for Social Security could be the lowest in years, causing concern among millions of beneficiaries who rely on these payments to cover their basic needs.

According to recent projections, the COLA for 2026 is estimated to be between 2.2% and 2.3%, figures lower than the 2.5% applied in 2025 and well below the 8.7% of 2023. These estimates come from organizations like The Senior Citizens League (TSCL) and independent analysts like Mary Johnson.

Panic in the United States: this from the SSA makes millions of Americans nervous

The COLA is calculated by comparing the Consumer Price Index for Urban Wage Earners and Clerical Workers for the third quarter of one year with that of the same period of the previous year. Although overall inflation has decreased, costs in key areas for retirees, such as housing and healthcare, continue to rise. 

For example, housing prices rose by 3.7% and healthcare by 2.8% in the first quarter of 2025. This discrepancy between the COLA and retirees' actual expenses has led to a steady loss of purchasing power. 

Since 2010, the value of a Social Security dollar has decreased by 20%. Additionally, it is estimated that to recover this loss, payments would need to increase by $370 per month.

The Social Security Administration and the US Government have received criticism

The situation is further complicated by the imposition of new tariffs by former President Donald Trump, which could increase inflation and indirectly affect Social Security payments. Although a higher COLA might seem beneficial, it doesn't always offset the rise in the cost of living.

In this scenario, the Social Security Administration (SSA) and the US Government have received criticism for not adapting the COLA calculation to the real needs of retirees. Experts suggest using the Consumer Price Index for the Elderly (CPI-E), which better reflects the spending habits of older people.

Everyone is watching what happens in October

The final COLA figure will be announced in October 2025 and will be applied starting in January 2026. Meanwhile, organizations like TSCL urge Congress to reform the system to ensure that Social Security benefits are adequately adjusted to inflation and protect retirees' purchasing power.

All in all, American retirees must prepare for a possible insufficient adjustment in their benefits in 2026, which could worsen their economic situation and increase pressure on the Social Security system.