Social Security COLA 2027 estimates predict bad news for seniors

A new estimate of the Social Security Cost of Living (COLA) for 2027 sparked a warning for senior citizens from the Senior Citizens League (TSCL).

Newsweek reached out to the TSCL for comment via email.

Why It Matters

Each year, Social Security payments change via the cost-of-living adjustment, or the COLA. It is intended to ensure “that the purchasing power of Social Security and Supplemental Security Income (SSI) benefits is not eroded by inflation,” according to the Social Security Administration (SSA). It’s critical to give seniors relief as they face high prices on housing, groceries and health care.

What to Know

Under the Senior Citizens League’s latest estimate, the Social Security COLA for 2027 would be 2.8 percent—the same as it was in 2026. That does mark a 0.3 point increase from January, when they predicted an increase of only 2.5 percent.

The organization warned that it may not be enough to sustain seniors.

“If the 2027 COLA really comes in at 2.8 percent, this paltry figure would only exacerbate seniors’ financial stress. TSCL’s research shows that 57.6 percent of America’s 55.8 million seniors have forgone at least one healthcare product or service to cut costs in the last 12 months. The top medical services that seniors skip to trim their budgets are dental (42.3 percent), vision (28.8 percent), and hearing (19.6 percent),” the organization’s report reads.

TSCL Executive Director Shannon Benton wrote in the release that the projection “will surely leave seniors dissatisfied and frustrated.”

“The reality is most older Americans constantly tell us they believe the CPI-W, the measure used to calculate the COLA, underestimates inflation as they see it. Affordability is the popular word around town right now, even among other groups, because most Americans believe inflation is higher than the government claims,” Benton wrote.

TSCL’s projection is based on the Consumer Price Index, the Federal Reserve’s interest rate, and unemployment rates.

The Social Security COLA is “based on increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W),” according to the SSA.

A 2.8 percent increase would be on par with the increases in recent years, but would fall short of the increases in the years following the COVID-19 pandemic, when the country faced higher rates of inflation. In 2022, for instance, the COLA reached a recent peak of 8.7 percent.

What People Are Saying

TSCL Executive Director Shannon Benton also wrote in the release: “Medicare treats dental, vision, and hearing insurance like extras or add-ons for American seniors, but access to these services is essential. Regular, preventive dental care can save you thousands of dollars in the long run, so, as a society, allowing cost to remain a barrier makes no sense. Vision and hearing loss also have meaningful connections to cognitive decline, meaning lack of access to this coverage progressively sabotages quality of life for countless seniors.”