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Social Security COLA: Most Say It's Not Enough
6 Dec
Summary
- 77% of older Americans feel the Social Security COLA doesn't cover rising prices.
- The 2026 COLA is set at 2.8%, a 56-dollar increase for average retirees.
- Experts suggest delaying benefits or diversifying income to bridge the gap.
Retirees are expressing widespread concern that the Social Security cost-of-living adjustment (COLA) is insufficient to cover escalating expenses. For 2026, the COLA is announced at 2.8%, which for the average beneficiary translates to an additional $56 per month. However, a substantial 77% of Americans aged 50 and older indicated in a recent survey that this increase does not adequately address rising prices.
The discrepancy between the official COLA and the actual cost of living for seniors is a growing issue. Financial experts note that the COLA calculation, based on the CPI for urban wage earners, may not reflect the spending patterns of retirees, who often have different essential expenses. This persistent gap can gradually diminish a retiree's purchasing power, potentially leading to a depletion of savings or the need to cut back on necessities.
To mitigate the impact of a COLA that falls short, financial advisors recommend proactive strategies. Key among these is considering delaying Social Security benefits until age 70 to secure the highest possible monthly payout. Additionally, diversifying retirement income sources beyond Social Security is crucial for maintaining financial security and a comfortable standard of living throughout retirement.
