The Cost-of-Living Adjustment (COLA) is a periodic increase in Social Security benefits, designed to help beneficiaries maintain their purchasing power despite rising inflation.
This adjustment applies to SSDI (Social Security Disability Insurance), retirement, survivor, and SSI (Supplemental Security Income) recipients in the United States.
COLA increases are determined using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which tracks inflation and price changes in a basket of goods and services.
For the 2026 COLA increase, the Social Security Administration (SSA) compares the CPI-W for the months of July, August, and September between 2024 and 2025.
This data allows them to calculate the exact COLA adjustments, which are typically paid in January 2026 for most beneficiaries. SSI recipients, however, will receive their COLA in a one-time payment on December 31, 2025.
When Will the 2026 COLA Be Announced?
The Bureau of Labor Statistics (BLS) will release the CPI-W for September 2025 on October 15, 2025, which is when the SSA will officially announce the 2026 COLA increase.
This announcement will be made at 8:30 AM, and millions of recipients will learn the exact percentage increase they will receive.
How Will the COLA Increase Impact SSDI Payments?
The 2026 COLA increase is expected to be 2.5%, as predicted by the Senior Citizens League in June 2025. For an individual receiving the average SSDI payment of $1,581, this could mean an increase to approximately $1,620 per month.
However, if inflation surpasses expectations, SSDI recipients could see even higher increases. Here are some possible scenarios based on different COLA predictions:
- 3% COLA: An SSDI payment of $1,000 would rise to $1,030.
- 4% COLA: An SSDI payment of $1,000 would increase to $1,040.
- 5% COLA: An SSDI payment of $1,000 would become $1,050.
- 6% COLA: An SSDI payment of $1,000 would rise to $1,060.
- 7% COLA: An SSDI payment of $1,000 would increase to $1,070.
- 8% COLA: An SSDI payment of $1,000 would become $1,080.
However, it’s important to note that while higher inflation could lead to a larger COLA increase, the most likely outcome is an increase closer to 2.5%, given the time remaining for changes to occur.
How to Manage Your COLA Increase
Although the COLA increase is often more noticeable when your payment amount is higher, it’s advisable to think of the COLA boost in annual terms rather than monthly increments. For example, an increase of $25 per month translates into an extra $300 for the year.
One great way to make the most of your COLA increase is to save it for the end of 2026. By doing so, you can create an emergency fund that will be beneficial when unexpected expenses arise. Saving this extra amount over the year can help you manage future financial challenges more effectively.
The 2026 COLA increase is a vital adjustment for millions of Social Security beneficiaries, ensuring that their benefits keep up with inflation.
While the final percentage increase won’t be confirmed until October 15, 2025, it’s important to plan ahead and consider saving your COLA for long-term financial stability.
If the increase is around 2.5%, SSDI recipients can expect a modest rise in their monthly payments, but higher inflation rates could lead to larger increases.
FAQs
When will the 2026 COLA increase be announced?
The 2026 COLA increase will be announced on October 15, 2025, after the Bureau of Labor Statistics releases the CPI-W for September 2025.
How is the COLA increase calculated?
The COLA is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which tracks inflation by comparing price changes in goods and services between July, August, and September of 2024 and 2025.
When will I receive my COLA increase payment?
For most beneficiaries, the COLA increase will be reflected in their January 2026 payment, while SSI recipients will receive it in a one-time payment on December 31, 2025.