For retirees relying on Social Security, the annual cost-of-living adjustment (COLA) is more than a minor tweak. It helps keep up with rising prices for food, housing, and healthcare. For 2026, the expected COLA is about 2.7 percent, according to early estimates from The Senior Citizens League. While that percentage applies nationwide, the dollar amount each recipient sees will vary depending on their current benefit.
In short, the bigger your monthly check now, the larger your raise will be next year. Here’s what you can expect from the 2026 COLA, which states are likely to see the biggest increases in real dollars, and how to prepare so you’re not caught off guard.
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COLA
Social Security’s COLA is determined by inflation data from the third quarter of the year—specifically the average of July, August, and September using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The Social Security Administration applies this percentage increase to benefits for the following January.
For example, the 2025 COLA was 2.5 percent, reflecting price increases in Q3 of 2024. The 2026 COLA is projected at 2.7 percent and will be announced on or around October 15, assuming no government shutdown delays the release.
Calculation
It’s one thing to hear “2.7 percent” and another to know what that means for your bank account. Here’s how Social Security turns the COLA into your actual payment:
- The 2.7 percent COLA is applied to your primary insurance amount (PIA), which is the benefit calculated from your lifetime earnings.
- That result is truncated to the next lowest dime.
- If you have Medicare Part B, the premium is deducted from that amount.
- Your final benefit is then rounded down to the nearest whole dollar.
This sequence means your increase may not be exactly 2.7 percent after deductions and rounding. Even small Medicare premium increases can eat into your raise.
TopStates
Because the COLA is based on a percentage, retirees with larger monthly benefits will see larger dollar increases. That’s why some states are poised for bigger gains—not because they get special treatment, but because their retirees tend to have higher benefits.
Here are the 10 states with the highest median monthly benefit for retired workers as of December 2024, according to SSA’s Annual Statistical Supplement 2025:
| State | Median Retired-Worker Benefit (Dec. 2024) |
|---|---|
| New Jersey | $2,172.00 |
| Connecticut | $2,159.00 |
| Delaware | $2,139.00 |
| New Hampshire | $2,121.00 |
| Maryland | $2,084.00 |
| Michigan | $2,067.00 |
| Washington | $2,061.00 |
| Minnesota | $2,053.00 |
| Massachusetts | $2,021.90 |
| Indiana | $2,016.00 |
For example, a 2.7 percent increase on a $2,172 monthly benefit (New Jersey) would yield about $58.64 more per month, before Medicare premiums or taxes. Compare that to someone with a $1,800 benefit, who would see only about $48.60 more.
Location
Does your location impact your Social Security check? Not directly. Your benefit is based on your earnings history and the age at which you claim. Where you live does not change how your benefit is calculated or adjusted.
So why do some states have higher median benefits? In general, states with higher lifetime incomes—like New Jersey, Connecticut, and Maryland—tend to produce higher Social Security payouts. These patterns reflect wage levels, job types, and claiming behavior, not location-based formulas.
That said, moving could affect your cost of living and state taxes, which indirectly affect how far your check goes.
Planning
Getting ready for the 2026 COLA doesn’t require spreadsheets, but a few smart steps now can help you manage your expectations and finances:
- Estimate your raise: Multiply your current gross benefit by 0.027. That gives you a ballpark figure for your 2026 COLA.
- Check your earnings record: Log in to your my Social Security account and confirm that your income history is accurate. Mistakes could mean future underpayments.
- Review Medicare premiums: If your Part B premium increases for 2026, your net deposit could go up by less than the COLA—or stay flat.
- Watch your taxes: Social Security benefits may be taxable at the federal level, and some states also tax them. This is separate from the COLA itself but can impact your final income.
Lastly, don’t assume moving to a new state will raise your benefit. It won’t. But it may help you reduce housing or healthcare costs, depending on where you go.
Recap
The 2026 COLA is expected to be 2.7 percent. While that increase applies nationwide, those with higher current benefits will get a larger boost in dollars. States with higher typical benefits—like New Jersey and Connecticut—will see the biggest average increases in monthly payouts.
No matter where you live, now’s a good time to run the numbers, confirm your earnings record, and prepare for possible Medicare or tax impacts. A little planning now can help ensure you actually feel the bump when it lands in your account in January.
FAQs
What is the expected 2026 COLA?
The forecasted COLA is 2.7 percent, announced in October.
Which states will see biggest COLA raises?
States with higher median benefits like NJ and CT.
Does moving states affect my Social Security?
No, benefits are based on your earnings and claim age.
Why is my COLA less than expected?
Rounding, Medicare premiums, and taxes can reduce it.
How do I estimate my 2026 benefit?
Multiply your current benefit by 0.027 for a rough guess.
