Multiple organizations have released preliminary estimates for Social Security’s 2027 cost-of-living adjustment, or COLA, following the release of new government inflation data. The estimates cluster around 3.4% to 3.6%, representing a decline from projections made earlier this year when inflation concerns were more pronounced.
Mary Johnson, an independent Social Security and Medicare policy analyst, estimates the adjustment at 3.4% based on July Consumer Price Index data. This marks a significant reduction from her June forecast of 4.7%, reflecting what Johnson characterized as moderation in inflation. The Senior Citizens League, a nonpartisan advocacy group, estimates the 2027 COLA at 3.6%, down from its previous projection of 3.8%. AARP calculates the adjustment at 3.5%, which would increase the average retired worker’s monthly benefit by approximately $73.
While these estimates exceed the long-term average COLA of approximately 2.6%, they remain within the context of recent volatility in the adjustment. The past decade has seen an average COLA of 3.1%, with notably elevated increases of 5.9% in 2022 and 8.7% in 2023 driven by inflationary spikes. The Consumer Price Index for Urban Wage Earners and Clerical Workers showed a 3.4% increase over the past 12 months as of July.
The Social Security Administration will announce the official 2027 COLA in October. The final figure will depend on inflation data from July, August, and September, as the adjustment is calculated by comparing third-quarter inflation figures to the previous year’s corresponding period. Analysts note that these current estimates remain preliminary and subject to revision based on upcoming inflation reports.
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