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Yahoo
25 minutes ago
- Business
- Yahoo
Social Security cost-of-living adjustment may be 2.5% in 2026, new estimate shows
The cost-of-living adjustment for Social Security could be 2.5% in 2026, based on the latest inflation data, new estimates show. That's up from last month's estimate of 2.4%, said Mary Johnson, an independent Social Security and Medicare policy analyst who forecasts 2026 COLA using monthly inflation data. A 2.5% increase would be the same gain beneficiaries received this year, but there's still time for the 2026 estimate to rise because the full impacts of President Donald Trump's tariffs are still unknown. "This estimate may rise with four more months of data still to come in before the 2026 COLA will be announced in October," Johnson said. Even though May inflation remained tame, most economists predict Trump's tariffs will raise inflation, which in turn, boosts the COLA. "Another month goes by with little evidence of tariffs, but the longer-term inflation challenge they pose remains," said Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management. Ken Kim, senior economist at KPMG, sees inflation peaking above 4% annually in the fall. That would be sharply higher than the 2.4% annual increase in the May consumer price index, a measure of average changes in goods and services costs. The average monthly Social Security check in May reached a record high $1,948.17. Based on that, a 2.5% increase would raise the monthly benefit by about $40.70. Roughly 75 million Americans, or about a fifth of the population, receive Social Security benefits. COLA is an annual adjustment to benefits meant to keep beneficiaries' purchasing power from being eroded by inflation. The final COLA for the following year is typically announced in October by the Social Security Administration. COLA is based on the percentage increase in the consumer price index for Urban Wage Earners and Clerical Workers from July through September of the last year as compared to the same three months of the current year. CPI-W tracks the overall inflation rate but can differ slightly. In May, annual CPI-W rose 2.2%, compared with the 2.4% rise in overall consumer prices. Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@ and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning. This article originally appeared on USA TODAY: Social Security COLA may be 2.5% in 2026, but tariffs could lift it
Yahoo
7 hours ago
- Business
- Yahoo
Social Security cost-of-living adjustment may be 2.5% in 2026, new estimate shows
The cost-of-living adjustment for Social Security could be 2.5% in 2026, based on the latest inflation data, new estimates show. That's up from last month's estimate of 2.4%, said Mary Johnson, an independent Social Security and Medicare policy analyst who forecasts 2026 COLA using monthly inflation data. A 2.5% increase would be the same gain beneficiaries received this year, but there's still time for the 2026 estimate to rise because the full impacts of President Donald Trump's tariffs are still unknown. "This estimate may rise with four more months of data still to come in before the 2026 COLA will be announced in October," Johnson said. Even though May inflation remained tame, most economists predict Trump's tariffs will raise inflation, which in turn, boosts the COLA. "Another month goes by with little evidence of tariffs, but the longer-term inflation challenge they pose remains," said Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management. Ken Kim, senior economist at KPMG, sees inflation peaking above 4% annually in the fall. That would be sharply higher than the 2.4% annual increase in the May consumer price index, a measure of average changes in goods and services costs. The average monthly Social Security check in May reached a record high $1,948.17. Based on that, a 2.5% increase would raise the monthly benefit by about $40.70. Roughly 75 million Americans, or about a fifth of the population, receive Social Security benefits. COLA is an annual adjustment to benefits meant to keep beneficiaries' purchasing power from being eroded by inflation. The final COLA for the following year is typically announced in October by the Social Security Administration. COLA is based on the percentage increase in the consumer price index for Urban Wage Earners and Clerical Workers from July through September of the last year as compared to the same three months of the current year. CPI-W tracks the overall inflation rate but can differ slightly. In May, annual CPI-W rose 2.2%, compared with the 2.4% rise in overall consumer prices. Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@ and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning. This article originally appeared on USA TODAY: Social Security COLA may be 2.5% in 2026, but tariffs could lift it Sign in to access your portfolio
USA Today
8 hours ago
- Business
- USA Today
Social Security cost-of-living adjustment may be 2.5% in 2026, new estimate shows
Social Security cost-of-living adjustment may be 2.5% in 2026, new estimate shows Show Caption Hide Caption Social Security checks increasing in 2025 The Cost of Living Adjustment is rising in 2025, which will change the amount of money people will receive in their Social Security checks. Fox - 10 Phoenix The cost-of-living adjustment for Social Security could be 2.5% in 2026, based on the latest inflation data, new estimates show. That's up from last month's estimate of 2.4%, said Mary Johnson, an independent Social Security and Medicare policy analyst who forecasts 2026 COLA using monthly inflation data. A 2.5% increase would be the same gain beneficiaries received this year, but there's still time for the 2026 estimate to rise because the full impacts of President Donald Trump's tariffs are still unknown. "This estimate may rise with four more months of data still to come in before the 2026 COLA will be announced in October," Johnson said. What do tariffs have to do with COLA? Even though May inflation remained tame, most economists predict Trump's tariffs will raise inflation, which in turn, boosts the COLA. "Another month goes by with little evidence of tariffs, but the longer-term inflation challenge they pose remains," said Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management. Ken Kim, senior economist at KPMG, sees inflation peaking above 4% annually in the fall. That would be sharply higher than the 2.4% annual increase in the May consumer price index, a measure of average changes in goods and services costs. How much would a 2.5% COLA increase amount to in dollars? The average monthly Social Security check in May reached a record high $1,948.17. Based on that, a 2.5% increase would raise the monthly benefit by about $40.70. Roughly 75 million Americans, or about a fifth of the population, receive Social Security benefits. What is COLA? COLA is an annual adjustment to benefits meant to keep beneficiaries' purchasing power from being eroded by inflation. The final COLA for the following year is typically announced in October by the Social Security Administration. How is COLA calculated? COLA is based on the percentage increase in the consumer price index for Urban Wage Earners and Clerical Workers from July through September of the last year as compared to the same three months of the current year. CPI-W tracks the overall inflation rate but can differ slightly. In May, annual CPI-W rose 2.2%, compared with the 2.4% rise in overall consumer prices. Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@ and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
Yahoo
8 hours ago
- Business
- Yahoo
Social Security cost-of-living adjustment may be 2.5% in 2026, new estimate shows
The cost-of-living adjustment for Social Security could be 2.5% in 2026, based on the latest inflation data, new estimates show. That's up from last month's estimate of 2.4%, said Mary Johnson, an independent Social Security and Medicare policy analyst who forecasts 2026 COLA using monthly inflation data. A 2.5% increase would be the same gain beneficiaries received this year, but there's still time for the 2026 estimate to rise because the full impacts of President Donald Trump's tariffs are still unknown. "This estimate may rise with four more months of data still to come in before the 2026 COLA will be announced in October," Johnson said. Even though May inflation remained tame, most economists predict Trump's tariffs will raise inflation, which in turn, boosts the COLA. "Another month goes by with little evidence of tariffs, but the longer-term inflation challenge they pose remains," said Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management. Ken Kim, senior economist at KPMG, sees inflation peaking above 4% annually in the fall. That would be sharply higher than the 2.4% annual increase in the May consumer price index, a measure of average changes in goods and services costs. The average monthly Social Security check in May reached a record high $1,948.17. Based on that, a 2.5% increase would raise the monthly benefit by about $40.70. Roughly 75 million Americans, or about a fifth of the population, receive Social Security benefits. COLA is an annual adjustment to benefits meant to keep beneficiaries' purchasing power from being eroded by inflation. The final COLA for the following year is typically announced in October by the Social Security Administration. COLA is based on the percentage increase in the consumer price index for Urban Wage Earners and Clerical Workers from July through September of the last year as compared to the same three months of the current year. CPI-W tracks the overall inflation rate but can differ slightly. In May, annual CPI-W rose 2.2%, compared with the 2.4% rise in overall consumer prices. Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@ and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning. This article originally appeared on USA TODAY: Social Security COLA may be 2.5% in 2026, but tariffs could lift it Sign in to access your portfolio
Yahoo
28-05-2025
- Business
- Yahoo
Social Security Set To Make History By Crossing $2,000 Barrier For First Time, But Seniors Still Losing Ground To Inflation
For the first time in the 90-year history of Social Security, the average monthly benefit for retired workers is projected to go beyond $2,000 next month. Despite the historic nature of this milestone, it is more an indication of inflation than financial security for beneficiaries. What Happened: The Social Security Administration's monthly reports show that the average retired-worker benefit was $1,999.97 in April. A statistical snapshot issued by the SSA indicates that May's average benefit will surpass the $2,000 threshold. Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — this is your last chance to become an investor for $0.80 per share. Nancy Pelosi Invested $5 Million In An AI Company Last Year — Here's How You Can Invest In Multiple Pre-IPO AI Startups With Just $1,000. This landmark is primarily on account of rising wages, new retirees entering the system, and run-of-the-mill cost-of-living adjustments. Why It Matters: While a $2,000 check may seem like a triumph, it hides a more concerning trend. According to Yahoo Finance, Social Security's purchasing power has consistently declined. A report from The Senior Citizens League in 2023 revealed that benefits lost 36% of their value between 2000 and 2023. From 2010 to mid-2024, buying power fell another 20%. Much of this decline relates to how inflation is calculated. The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), the metric used for Social Security adjustments, does not accurately reflect how seniors spend, especially when it comes to housing and healthcare. Cost-of-living increases have not kept pace with real-world expenses. 'A Social Security dollar simply isn't what it once was,' the report states. Retirees who depend on these monthly payments to purchase essentials are struggling to stay within budget. The $2000 milestone comes just as the Department of Education has restarted involuntary collections on defaulted student loans, with defaulters at risk of receiving significantly reduced SSA checks. Despite President Donald Trump's claims about bolstering Social Security, multiple crucial changes to the program, capable of impacting millions of beneficiaries, are not up to him. Read Next: Hasbro, MGM, and Skechers trust this AI marketing firm — Invest before it's too late. Deloitte's fastest-growing software company partners with Amazon, Walmart & Target – Many are rushing to grab 4,000 of its pre-IPO shares for just $0.30/share! Photo courtesy: Shutterstock Send To MSN: Send to MSN Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article Social Security Set To Make History By Crossing $2,000 Barrier For First Time, But Seniors Still Losing Ground To Inflation originally appeared on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
