Social Security’s cost-of-living increase will rise 2.8% in 2026, representing an average increase of more than $56 for retirees each month, agency officials said Friday.
Benefit increases for nearly 71 million Social Security recipients will take effect in January. And increased payments for the nearly 7.5 million people receiving Supplemental Security Income will begin Dec. 31.
Friday’s announcement was supposed to be made last week but was delayed due to the federal government shutdown.
The cost-of-living adjustment, or COLA, for retirees and disabled recipients is funded by payroll taxes collected from workers and their employers up to a certain annual salary, which is set to increase to $184,500 in 2026 from $176,100 in 2025.
Recipients face a 2.5% cost-of-living increase in 2025 and a 3.2% increase in benefits in 2024, following a historically large benefit increase of 8.7% in 2023, driven by a 40-year record high for inflation.
The smaller increase for 2026 reflects easing inflation.
Social Security Administration Commissioner Frank Bisignano said in a statement Friday that the annual cost-of-living adjustment “is one way we work to ensure that benefits reflect today’s economic realities and continue to provide a foundation of security.”
Emerson Sprick, director of the Bipartisan Policy Center’s retirement and labor policy division, said in a statement that cost-of-living increases “cannot solve all the financial problems households face or all the program’s shortcomings.”
The latest COLA announcement comes as the Social Security Administration has been through nearly a year of turmoil, including thousands of layoffs as part of the Trump administration’s push to shrink the size of the federal workforce. Trump administration officials also made statements they later retracted that raised concerns about the future of the program.
Treasury Secretary Scott Bessent said in July that the Republican administration was committed to protecting Social Security, hours after he said in an interview that the new Child Savings Program signed by President Donald Trump “is a back door to privatize Social Security.”
And in September, Bisignano had to walk back comments that the agency was considering raising the retirement age to shore up Social Security. “The administration is not currently considering raising the retirement age,” Bisignano said in an emailed statement to The Associated Press.
“I think everything is being considered, will be considered,” Bisignano said in a statement when asked if raising the retirement age was an option to preserve the solvency of the old-age program.
Additionally, the Social Security Administration is facing an impending bankruptcy date if Congress does not address it. A June 2025 report from the Social Security and Medicare administrators said Social Security’s trust funds, which cover old-age and disability beneficiaries, would not be able to pay full benefits starting in 2034. After that, Social Security could only pay 81% of benefits.
Social Security benefits were last reformed about 40 years ago, when the federal government raised the eligibility age for the program from 65 to 67.
