Important points
- The cost of living adjustment (COLA) for Social Security benefits in 2026 is set at 2.8%, averaging an increase of around $56 monthly.
- However, many seniors, along with advocates for Social Security, argue that these increases fall short of meeting rising costs associated with medical services and Medicare premiums.
- The Trump administration is suggesting that some Americans might be excluded from the Supplemental Security Income (SSI) program, which aids millions who receive insufficient Social Security benefits.
From updates on cost-of-living adjustments for 2026 to various proposals aiming to cut parts of the program, here’s a summary of significant developments in Social Security from last month and what they could mean for you.
Why is this important
These changes impact all recipients of Social Security, but particularly for those on fixed incomes, as unexpected expenses can be challenging to manage. It’s advisable for them to plan their budgets well in advance.
Social Security benefits will increase by 2.8% in 2026
The Social Security Administration revealed the cost of living adjustments for 2026 last October. This adjustment, a 2.8% increase, aims to counter inflation.
The COLA is determined annually based on inflation rates from the third quarter, and it will take effect in January. This year’s adjustment is greater than the 2.5% increase seen in 2025, attributed largely to heightened inflation from tariffs.
What this news means to you
For the year 2026, the uptick in Social Security benefits will assist beneficiaries in managing the rising costs of essentials like food and medications. Additionally, this adjustment may help those enrolled in Medicare, especially as some aspects of the program are anticipated to increase in cost next year.
But the adjustment may not suffice for many beneficiaries
According to findings by The Senior Citizens League, those on Social Security could see a 20% drop in their purchasing power from 2010 to 2024. Furthermore, in 2026, premiums for Medicare Part B— which affects about 63 million Americans, including seniors—are projected to climb 11.6%, surpassing the 2.8% benefit increase.
Some advocates are suggesting that a new inflation index be implemented, one that reflects the rising costs more accurately for older Americans. There’s also a proposal for a one-time $1,400 stimulus check to assist beneficiaries who might feel the delay of Social Security benefits more acutely.
What this news means to you
Now might be the time for Social Security recipients to reconsider their budgets for 2026. As Medicare enrollment is currently open, some individuals may need to explore more affordable insurance options.
Additionally, experts recommend considering downsizing living situations to mitigate high housing expenses, re-entering the workforce, or minimizing discretionary spending.
Trump administration expected to cut some Social Security programs
In light of urgent funding challenges for Social Security, the Trump administration is exploring ways to reduce expenditures, potentially cutting some beneficiaries from various Social Security Administration programs.
While the administration has pledged to avoid reducing Social Security benefits or altering the retirement age, proposed changes to the Supplemental Security Income (SSI) program could affect approximately 7.4 million seniors and individuals with disabilities who rely on limited income.
The Social Security Administration under President Trump’s administration is also weighing the reversal of Biden-era changes that expanded program eligibility, which could potentially eliminate or reduce benefits for about 400,000 current SSI beneficiaries.
What this news means to you
It’s worth noting that around 2.5 million Americans receive both Social Security and SSI. If eligibility for SSI were lost, an individual’s income could drop by an average of about $594 monthly.
Eliminating SSI could put many beneficiaries in a tough position, especially as they contend with rising expenses. A number of seniors believe that their Social Security benefits haven’t kept pace with their growing costs.
