Social Security benefits will rise by 3.6 percent in 2027, adding about $75 a month to the average retired worker’s benefit, the Social Security Administration announced October 14. The adjustment will begin with benefits payable in January and affects nearly 72 million Social Security beneficiaries, according to the agency.
The increase is larger than the 2.8 percent adjustment for 2026. Not everyone will get an extra $75, though. The dollar change depends on each person’s benefit, and deductions can shrink what actually reaches a household.
How the adjustment is calculated
The annual cost-of-living adjustment, or COLA, is tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers. The Social Security Administration compares the average index level for the third quarter of the current year with the third quarter of the year before.
SSA estimates in its 2027 COLA fact sheet that the average retirement benefit will increase by about $75 per month. Supplemental Security Income payments will also rise by 3.6 percent, with the new amount reflected for most SSI recipients on December 31, 2026. Social Security and SSI are separate programs with overlapping recipients, so their beneficiary counts cannot simply be added together.
The adjustment is automatic for eligible recipients. People do not need to pay a fee or submit a new application to receive the COLA. SSA says benefit notices will explain an individual’s updated amount, and people with online accounts can check their notice through the agency’s portal.
A larger check does not guarantee more buying power
The COLA follows inflation, but not anyone’s personal budget. The CPI-W tracks prices experienced by urban wage earners and clerical workers. Retirees may spend different shares of their budgets on housing, medical care, food or transportation, so their own costs can rise faster or slower than the index used for the adjustment.
Medicare premiums, tax withholding, benefit offsets and other deductions can also change the amount deposited, so the headline raise can overstate the gain in spending money.
Beneficiaries interviewed by the Associated Press raised concerns about medical and other living costs. The adjustment also has no bearing on Social Security’s long-term financing, which is a separate policy question.
What recipients should watch
Recipients should look for their individual notice and compare the gross benefit with the amount they expect to receive after deductions. SSI recipients should note the earlier payment date for the January adjustment. For budgeting, the 3.6 percent increase is one input; health premiums, housing and other big expenses still need updating as those figures come out.
For more reporting on the program, visit our Social Security coverage. The average increase is an agency estimate, not a projection of any individual payment.