Forecast Predicts Larger 2027 Social Security Cost‑of‑Living Increase

John Hart, CEO of OpenTheBooks, appeared on Varney & Co. to discuss the long‑term deficits in Social Security and Medicare amid mounting fiscal pressures.

The report predicts that Social Security recipients will receive a larger cost‑of‑living adjustment in 2027, driven by continued high inflation.

According to an analysis by The Senior Citizens League, the projected COLA for 2027 is 3.8%, surpassing the 2.8% increase projected for 2026. This estimate, based on the latest CPI data released Tuesday, would raise average monthly benefits by $73.62, from $1,937.53 to $2,011.15.

The 3.8% projection matches last month’s forecast and is a slight decline from the 3.9% estimate made in April.

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Social Security benefits could rise 3.8% in 2027, according to the latest estimate of next year’s COLA. (Getty Images/iStock)

‘We are witnessing rising inflation at a time when more than half of seniors cannot afford basic living standards,’ said Shannon Benton, Executive Director of TSCL, following the release of the group’s June estimate, which also projects a 3.8% COLA for 2027.

This includes expenses for food, housing, and transportation. Many seniors already skip doctor appointments because of cost, ultimately costing society more as preventive care is replaced by emergency care.

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Social Security COLA aims to keep benefits on pace with inflation. (Wesley Lapointe/For The Washington Post via Getty Images)

The most recent CPI data indicated a 3.5% year‑over‑year increase in June, exceeding the Federal Reserve’s 2% target and placing considerable strain on household budgets as wage growth fails to keep pace with rising living costs.

The CPI‑W, the inflation measure used to calculate Social Security’s COLA, also rose 3.5% from a year ago in June.

A larger COLA would further strain Social Security’s finances, accelerating the depletion of a key trust fund and potentially prompting benefit reductions.

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Social Security’s key trust fund is facing depletion in 2032, which would prompt automatic benefit cuts if Congress doesn’t act. (Getty Images/stock)

The nonpartisan Committee for a Responsible Federal Budget estimated in May that a 3.8% COLA in 2027 would increase Social Security’s fiscal shortfall by roughly $300 billion over the next decade and move the insolvency of a key trust fund forward by three months, to late 2032.

When the trust fund is exhausted, the Social Security Administration is legally required to reduce benefits to match incoming payroll tax revenues, which the CRFB estimates would entail a 25% cut — effectively erasing nearly a decade of COLA increases.

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