Social Security Cost-of-Living Adjustments Delayed Due to Government Shutdown
WASHINGTON – The current government shutdown has postponed the announcement of annual Social Security cost-of-living adjustments (COLA) for millions of beneficiaries.
Initially set for Wednesday, the COLA announcement will now be on October 24. This will be released alongside the September Consumer Price Index, which has not yet been published.
The Social Security Administration makes annual adjustments based on inflation rates. The delay highlights the challenges people face in managing their finances as the shutdown drags into its third week with no resolution in sight.
Organizations like the Coalition on Aging and AARP expect the COLA to rise by about 2.7%. Around 70.6 million individuals receive Social Security benefits, including retirees, disabled persons, and children.
Concerns have been raised by beneficiaries about whether next year’s increase will be sufficient to offset rising living costs.
Sue Conard, a 75-year-old retiree and Social Security recipient from La Crosse, Wisconsin, recently attended a lobbying event with other retired Americans. They advocated for meaningful changes to healthcare protections and Social Security benefits amid the ongoing shutdown.
Conard expressed a desire for lawmakers to revisit how COLA calculations are made, criticizing the standard Consumer Price Index for not fully reflecting the expenses commonly faced by older adults.
On the steps of the Longworth House office building, Conard remarked, “The way COLA is determined is flawed becausemedical expenses aren’t included in the CPI.”
Some legislators are suggesting a shift to using the Consumer Price Index for the Elderly (CPI-E) as a more accurate measure for determining cost-of-living increases, which would reflect senior citizens’ spending habits on essentials like healthcare and groceries.
The agency plans to inform recipients of their new benefit amounts in early December. A spokesperson, speaking anonymously, mentioned that regardless of the government’s funding issues, retirement benefits and Supplemental Security Income will still be adjusted starting January 1, 2026, without delay.
This announcement delay occurs amid serious funding challenges facing the social insurance program in the coming years, compounded by significant staff reductions within the agency.
A report from the Social Security and Medicare Administration Board in June indicated that the program’s trust fund might not be able to provide full benefits as early as 2034, a year earlier than previously estimated. If the trust fund is exhausted, only 81% of scheduled benefits could be paid out.
Moreover, this year, the agency laid off around 7,000 of its 60,000 employees, which has added pressure on the remaining staff to handle claims and inquiries from an increasing number of beneficiaries.
