Social Security Announces 3.6% Cost-of-Living Raise for 2027, the Largest Since 2023
The increase averages about $75 a month for retirees and will reach 76 million Americans starting with January 2027 benefits.
Seniors will get their biggest Social Security raise in four years. The Social Security Administration announced Wednesday a 3.6% cost-of-living adjustment for 2027.
On average, the increase adds about $75 a month to retirement benefits. It takes effect with benefits paid for January 2027 and covers Old-Age, Survivors and Disability Insurance and Supplemental Security Income. Commissioner Frank Bisignano said it will go to 76 million Americans, "giving them greater financial stability."
The adjustment is set by the consumer price index for urban wage earners and clerical workers, using the July, August and September readings. Its purpose is to keep benefits from losing buying power to inflation. Fox Business reports the larger raise this year was driven in part by energy prices that surged after the outbreak of the Iran war and have stayed high.
It is the largest since 2023, when benefits rose 8.7%. The raise shrank as inflation cooled, coming in at 3.2% for 2024, 2.5% for 2025 and 2.8% for 2026.
AARP CEO Myechia Minter-Jordan said there is "a lot on the line financially right now for older Americans," noting that one in five have no retirement savings and more people feel financially insecure this year than last. She called the adjustment "critically important" for groceries, bills and health care.
The nonpartisan Committee for a Responsible Federal Budget offered a more pointed read. It said the 3.6% increase would lift average benefits by about $900 per retiree a year but give an increase of over $2,200 to the very richest beneficiaries. By its math, the highest-earning couples who retired this year at their normal retirement age will see a $3,600 combined increase, enough to push their combined benefits above $100,000 a year.
Read next to the Labor Department's September inflation report, which put prices up 3.7% from a year ago, the new raise roughly tracks what seniors are paying. It does not make up for the price run-ups of earlier years.