Multiple organizations have released preliminary estimates for Social Security’s annual cost-of-living adjustment for 2027, with figures ranging from 3.4% to 3.6% based on recent government inflation data. Mary Johnson, an independent Social Security and Medicare policy analyst, estimates the COLA at 3.4%, marking a decline from her previous projections of 3.7% in recent weeks and 4.7% several months earlier. Johnson attributed the downward revision to moderation in inflation trends.
The Senior Citizens League and AARP have issued their own projections, with the Senior Citizens League estimating 3.6% and AARP projecting 3.5%. AARP’s estimate would translate to approximately $73 in additional monthly benefits for the average retired worker. These estimates remain preliminary and subject to revision as economic data continues to emerge.
The Social Security Administration calculates the COLA using the Consumer Price Index for Urban Wage Earners and Clerical Workers, known as the CPI-W. The latest data shows the CPI-W increased 3.4% over the past 12 months as of July, while the broader consumer price index also rose 3.4% during the same period. The calculation methodology compares third-quarter inflation data from July, August, and September against the same period from the previous year.
While the current estimates exceed the long-term average COLA of approximately 2.6%, they represent a moderation from earlier projections. Recent years have seen significant COLAs, with 2022 and 2023 delivering increases of 5.9% and 8.7% respectively. The Social Security Administration will announce the official COLA for 2027 in October, with final figures potentially shifting based on inflation data released over the coming weeks.
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