Social Security sets a 3.6% COLA for 2027

The Social Security Administration said Wednesday that benefits will rise 3.6% in January, up from 2.8% this year.

For the typical retired worker, that adds about $75 a month, lifting the average check to $2,162.67 from $2,087.52, according to The Senior Citizens League. Over a full year, that is roughly $900 more, according to estimates from AARP and the Committee for a Responsible Federal Budget.

The adjustment follows a statutory formula: the SSA compares year-over-year CPI-W readings for July, August and September. In 2026 those readings were 3.4%, 3.5% and 3.9%, The Senior Citizens League noted.

Fuel costs drove much of the increase, The Senior Citizens League said, with crude oil averaging $64.50 a barrel in January before peaking at $108.64 in May. The final COLA came in 0.9 percentage point above Social Security's trustees' most recent projection, the Committee for a Responsible Federal Budget said.

At 3.6%, the adjustment ties for 18th among the 52 COLAs since indexing began in 1975, The Senior Citizens League said.

The CPI-W measure tracks the spending of working households rather than retirees, and advocates argue that it understates retiree costs. In The Senior Citizens League's 2026 survey, 89% of respondents called the previous adjustment too low; an AARP poll before the announcement found 76% of adults 50 and older said a 3.5% COLA would not keep pace with prices.

"They're getting a slightly bigger check to pay bills that have gotten even bigger," Shannon Benton, executive director of The Senior Citizens League, told CBS News. Because the measure looks backward, the money arrives in January, months after the prices it reflects.