Social Security COLA forecast for 2027 jumps to 3.9% in response to rising inflation

The forecast for the 2027 cost-of-living adjustment (COLA) for Social Security benefits has risen sharply to 3.9%, driven by persistent inflation in housing, utilities and energy, according to new data released by The Senior Citizens League.

The projection — up from a steady 2.8% estimate just one month ago — would raise the average monthly benefit for retired workers to roughly $2,162, up from the current figure of $2,081, based on April 2026 figures from the Social Security Administration.

The adjustment, detailed in a report from Kiplinger, is tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers, which rose 3.8% in April, according to the U.S. Bureau of Labor Statistics.

Energy prices alone reportedly increased 3.8% for the month, accounting for more than 40% of the overall increase.

“For retirees living on fixed incomes, the costs that matter most — especially health care, housing, utilities and insurance — continue to rise faster than prices in the rest of the economy, silently wrenching seniors dry,” Shannon Benton, executive director of the Senior Citizens League, told Kiplinger.

The official COLA announcement is typically made in mid-October, but the advocacy group cautions that the forecast could change.

Its 2026 Loss of Buying Power study found that Social Security benefits are worth only about 86.3 cents on the dollar compared with 2016 as COLAs have been too small to keep pace with rising costs, Kiplinger reported. 

The Senior Citizens League estimates benefits would need to rise by 15.7%, or $295.85 per month for the average beneficiary, to recover lost value.

Medicare premiums, which are typically deducted from Social Security checks, are also projected to rise in 2027, partially offsetting the COLA increase.

According to the 2025 Medicare Trustees Report, the standard monthly Part B premium is projected to reach $218.60 in 2027, up from $202.90 this year.

The Part B deductible would rise to $305 from $283.

Retirees can increase their monthly benefits by delaying claims until age 70, which yields an additional 8% per year beyond full retirement age. Claiming at age 62 instead can reduce benefits by 30% for those born in 1960 or later, Kiplinger added.

This article was generated using HousingWire Automation and reviewed by a HousingWire editor before publication. The system helps convert company announcements and industry data into HousingWire-style news coverage.