The Senior Citizen’s League’s (TSCL) model of estimating the cost-of-living adjustment (COLA) for retirees points to a 3.9% increase. TSCL’s 2027 COLA estimate 1.1 percentage points higher than the 2026 COLA. TSCL also estimates the average benefits check for retired workers would increase by $81.17, from $2,081.16 to $2,162.33.
While TSCL’s current model already projects a higher COLA in 2027 than the 2.8 percent issued in 2026, rising oil prices could have downstream effects on the economy and push inflation even higher. TSCL cites the Louis Federal Reserve has found that higher oil prices “have historically coincided with both food prices and broader consumer inflation.”
Healthcare also remains one of the biggest financial pressures facing seniors. Increases in Medicare premiums, prescription drug costs, or insurance expenses can significantly reduce the real value of annual COLA increases.
“Many seniors are telling us the same thing: As inflation picks back up, life still does not feel affordable,” TSCL Executive Director Shannon Benton said.
“For retirees living on fixed incomes, the costs that matter most, especially healthcare, housing, utilities, and insurance, continue to rise faster than prices in the rest of the economy, silently wrenching seniors dry,” Benton said. “This makes the national affordability conversation even more important than ever. People earn their Social Security benefits through a lifetime of work, but some policymakers have proposed cutting benefits by moving to a Chained Consumer Price Index, which assumes people will accept a lower cost of living when prices rise. Policymakers should focus on strengthening the program in ways that protect retirees’ financial security, not trying to mask benefit cuts as something else.”
Understanding the Chained Consumer Price Index
The Chained CPI is a relatively new measure of inflation. This video from the Department of Labor provides an overview of the chained CPI and its advantages and limitations in comparison to other measures.
SEE ALSO: Guide to Federal Retiree COLAs: What Are They and How Are They Calculated?
Each month, TSCL issues a new prediction of the next COLA for Social Security using its statistical model. “Our model incorporates the Consumer Price Index, the Federal Reserve interest rate, and the national unemployment rate to make its predictions,” TSCL says. The model’s predictions update throughout the year, adjusting in response to economic conditions.
The official 2027 COLA will be released by the Social Security Administration (SSA) in mid-October 2026. The SSA will calculate the percent change between average prices in the third quarter of the current year (ending on Sept. 30) with the third quarter of the previous year.