A larger Social Security raise could arrive in 2027 for millions of US retirees, with one advocacy group forecasting a 3.8% cost-of-living adjustment that would lift the average monthly benefit to about $2,103 but that higher Social Security COLA could also push more pensioners into paying federal income tax on their benefits. The estimate, from the Senior Citizens League, points to roughly $77 extra per month for a typical retired worker if current inflation trends hold into next year.
The projected 2027 cost-of-living adjustment follows several years in which prices for essentials such as energy and shelter have risen faster than many retirees' benefits. Social Security's annual COLA is intended to preserve purchasing power by tying payments to inflation, but the mechanism used and the way tax rules interact with it often leaves older Americans feeling they are running to stand still.
