WASHINGTON, Aug. 13 (Senior Newspaper) — Preliminary estimates for the 2027 Social Security cost-of-living adjustment now range from 3.2% to 3.6%, giving beneficiaries and retirement planners a wider set of possible outcomes before the federal government issues the official figure.
The updated forecasts followed July inflation data from the Bureau of Labor Statistics. The estimates come from the Committee for a Responsible Federal Budget, AARP, the Senior Citizens League and independent Social Security and Medicare policy analyst Mary Johnson.
The range matters because the annual adjustment affects monthly income for Social Security beneficiaries, including retired workers. It can also influence household budgets, spending decisions and plans for covering food, housing, health care and energy costs.
What are the current estimates?
The Committee for a Responsible Federal Budget projects a 3.2% increase, the lowest of the estimates cited after the July data. The group said the Consumer Price Index for Urban Wage Earners and Clerical Workers, known as CPI-W, was flat in July and up 3.4% from a year earlier.
AARP projects a 3.5% increase. The organization described it as its first forecast issued before the remaining third-quarter inflation reports are released.
The Senior Citizens League projects a 3.6% increase, down from its earlier 3.8% projection. Johnson’s estimate is 3.4%, down from 3.7% the previous month and 4.7% in June.
The differing forecasts reflect the fact that the final adjustment has not yet been determined. Inflation readings for August and September are still needed.
How would the estimates affect monthly benefits?
The Senior Citizens League calculated that a 3.6% adjustment would raise an average monthly benefit by $69.75, from $1,937.53 to $2,007.28. That calculation is an estimate, not a change that has been approved or put into effect.
The actual dollar increase for an individual beneficiary would depend on that person’s current benefit. A percentage adjustment applies to benefits at different rates in dollar terms: a larger monthly benefit produces a larger dollar increase, while a smaller benefit produces a smaller one.
Why have the forecasts moved?
The estimates have shifted as new inflation data have arrived. Earlier projections included a 3.8% estimate from the Senior Citizens League, a 3.6% estimate from AARP and a 3.7% estimate from Johnson before the July CPI report.
The Bureau of Labor Statistics said CPI-W rose 3.4% over the 12 months through July, down from 3.5% in June. That moderation helped push several forecasts lower.
The Senior Citizens League has also pointed to volatility in inflation as a reason for caution. AARP vice president for financial security Rich Johnson said food and energy prices could change the outlook over the next two months and that the estimate was not final.
When will the official COLA be set?
The Social Security Administration calculates the annual adjustment using CPI-W readings for July, August and September. It is expected to announce the 2027 COLA on Oct. 14, after the September inflation data become available.
The adjustment is expected to take effect for benefits paid in January 2027. Until the Social Security Administration announces the figure, all current percentages remain forecasts rather than official benefit increases.
For beneficiaries, the next two months of inflation data are the key remaining variables. A rise or drop in prices, especially for categories such as food and energy, could move the final adjustment above or below the current estimates.
