What COLA actually is
The cost-of-living adjustment is an annual recalculation of Social Security benefits to keep pace with inflation. SSA calculates it from the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), specifically the average for the third quarter (July through September) of the year before the increase takes effect.
For the 2026 COLA, SSA used CPI-W from July, August, and September 2025. That third-quarter average rose 2.5 percent over the same quarter in 2024, so every Social Security benefit increased by exactly 2.5 percent starting with the January 2026 payment.
The 2026 numbers
The maximum federal SSI benefit increased from $943 in 2025 to $967 in 2026 for a single recipient, and from $1,415 to $1,450 for an eligible couple. Average retirement benefits rose from $1,927 to $1,976. Average SSDI rose from $1,540 to $1,580. The maximum monthly benefit at full retirement age went from $3,822 to $3,917.
Why your net deposit may have changed by less (or more) than 2.5 percent
Three deductions can change at the same time as COLA, and they often eat into the increase or rarely amplify it.
Medicare Part B premium: The standard premium increased from $174.70 in 2025 to $185.00 in 2026. That is a $10.30 monthly increase. For a recipient at the new $1,976 average benefit, the gross increase from COLA is $48 per month ($1,976 minus $1,927). Subtract the $10.30 Part B increase and the net is $37.70.
IRMAA surcharges: Income-Related Monthly Adjustment Amount surcharges apply if your modified adjusted gross income from two years prior exceeds $103,000 single or $206,000 joint. The 2026 income brackets shifted slightly, so some recipients moved into or out of a surcharge tier. IRMAA can add anywhere from $74 to $443 per month to your Part B premium and a similar amount to Part D.
Federal tax withholding: If you have voluntary withholding set up (Form W-4V), the dollar amount stays fixed unless you update the form. A flat $200 monthly withholding does not auto-scale with COLA, so your post-tax net rises with the full COLA amount minus Medicare.
A worked example
Take a retiree who got $1,927 in December 2025 with no IRMAA and no withholding. Gross COLA increase: $48. Standard Part B increase: $10.30. Net change starting January 2026: +$37.70 per month, or $452 more over the full year. Their actual January 2026 deposit was $1,791 net (gross $1,976 minus Part B $185).
Now take a higher-income retiree at $3,500 gross with full IRMAA tier 1 ($73.50 add-on). Gross COLA increase: $87.50. Their Part B with IRMAA went from $244.50 to $259.40 (an $14.90 increase). Net change: +$72.60 per month.
How to see your exact COLA letter
SSA sent COLA notices in December 2025 by mail and electronically through my Social Security accounts. The notice lists your new gross benefit, the new Part B deduction, any IRMAA surcharge, any tax withholding, and the resulting net deposit. If you cannot find the letter, log in to ssa.gov/myaccount, choose Benefits and Payment, and download the most recent COLA notice as a PDF.
Looking ahead to 2027
The 2027 COLA will be announced in October 2026 based on July-September 2026 CPI-W. Early 2026 inflation has been running between 2.3 and 2.7 percent year-over-year, so analysts are projecting the 2027 COLA in roughly the same range as 2026, between 2.4 and 2.8 percent.