Seniors will see a 2.8% increase in their monthly Social Security benefits in 2026, a decision that appears to fall short of the expectations of many Americans, according to a recent survey conducted by AARP. This cost-of-living adjustment (COLA), which will result in an average monthly benefit increase of approximately $56 starting in January, was announced by the Social Security Administration (SSA). Beneficiaries can expect to receive letters in December detailing their new monthly amounts, while those with personal my Social Security accounts can access their COLA notices online earlier.
The COLA is designed to help seniors adjust to inflationary pressures; however, only about 22% of Americans aged 50 and older feel that a 3% increase is sufficient to cope with rising costs. A notable 77% of respondents disagreed, demonstrating widespread concern across political lines—75% of Republicans, 82% of Independents, and 79% of Democrats felt similarly.
Experts express concern that rising Medicare premiums could negate the benefits of the COLA for many seniors. Mary Johnson, a knowledgeable Social Security and Medicare analyst, indicated that the increases in Part B premiums—which are not yet finalized but are projected to rise to around $206.50 per month from $185 in 2025—will likely consume the COLA adjustment entirely for a significant number of beneficiaries.
The effects could be compounded further, as some Part D drug plan premiums are reportedly set to increase by up to $50 in 2026, following a state program’s guidelines. With the total number of stand-alone Part D plans having halved since 2024, beneficiaries could find themselves with fewer options that meet their needs. Johnson shared her experience of finding that her drug plan costs have skyrocketed by nearly 53%, a stark contrast to the modest COLA increase.
Historically, the 2.8% COLA is slightly below the average increase seen over the last decade, which has been about 3.1%, while the COLA for 2025 was previously recorded at 2.5%. Additionally, the current COLA is already trailing behind inflation, which registered at 3.0% in September—higher than both the Federal Reserve’s target and the long-term average.
In an AARP survey, 72% of older Americans indicated they would need a COLA increase of at least 5% to consistently afford their everyday expenses, with 26% asserting that an 8% increase would be necessary.
The implications for seniors are significant; poverty rates among those aged 65 and older have risen, marking the only demographic to see an increase in 2024. Faced with mounting expenses and not enough income to compensate, many older adults are at risk of financial insecurity. Ramsey Alwin, president of the National Council on Aging, highlighted that the forthcoming COLA will not provide sufficient financial security for many seniors.
The SSA bases its annual COLA on average increases in the consumer price index for urban wage earners from July through September. As of August, over 74.5 million Americans were receiving Social Security benefits, comprising retired workers, disabled individuals, survivors of deceased workers, and those receiving Supplemental Security Income.
As this situation develops, it raises vital discussions about how we can better support older generations in managing their financial challenges during retirement years.