Social Security’s 2026 COLA on track to break a 29-year trend

On July 15, 2025, the Bureau of Labor Statistics released the latest CPI numbers. That's a really boring sentence, but the numbers are actually extremely important and should be very interesting to Social Security retirees.

That's because the Consumer Price Index for Urban Wage Earners and Technical Workers (CPI-W) is used to determine the Cost of Living Adjustment (COLA) that retirees will receive in 2026.

That's better known as the annual Social Security benefits increase, or the raise that Social Security retirees get in most years.

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The Social Security Administration looks at changes to a basket of goods and services that is included in the consumer price index. The average changes to CPI-W are calculated in the third quarter of the year, and that's the raise retirees get on their Social Security benefits.

Since the June numbers are the first ones to be released from this third quarter's data, they provide a very important glimpse into what next year's raise may look like. And based on those numbers from July 15, the 2026 Social Security COLA is on track to do something it has not done in 29 years.

Retirees won't see a COLA trend like this again.

Image source: Shutterstock

The July CPI data showed that the Consumer Price Index rose 2.7% on an annual basis, while the CPI-W numbers showed a 2.6% year-over-year increase.

While it's the CPI-W numbers on which COLAs are based, experts are also making projections for what the CPI numbers will look like for the next two months, which are also included in the benefit calculation.

Based on those projections, the Senior Citizens League has predicted a 2.6% benefits increase next year, up from the 2.5% raise predicted last month. Independent Social Security and Medicare policy analyst Mary Johnson, however, is projecting a 2.7% bump.

Regardless of which of these is right, however, the COLA is about to buck a 29-year trend. That's because, for the first time since 1996, the COLA is going to be above 2.5% for five consecutive years.

This is a once-in-a-generation shift for today's retirees, and it is not something that most people will probably see again in their lifetime.

The 2026 COLA is busting this 29-year-old trend

If the COLA comes in as projected, Social Security is going to hit a major milestone. For the first time since 1996, retirees are going to see a COLA that has been equal to or above 2.5% for five years running.

Here's what the recent COLAs have looked like:

2021: 5.9%
2022: 8.7%
2023: 3.2%
2024: 2.5%
2026: 2.6% or 2.7% (projected)

And the last time the COLAs had a five-year streak where they were at 2.5% or higher was from 1993 to 1996. Here were the COLAs during that time period:

1992: 3.0%
1993: 2.6%
1994: 2.8%
1995: 2.6%
1996: 2.9%

That period in the 1990s was actually part of a decades-long streak of high COLAs due to high inflation. Since that time, however, there has not been another five-year period when raises were so high. In fact, there were several years in the mid-2000s when COLAs were under 1.00%.

While it may seem, in theory, that five years of raises are good for retirees, that's very much not the case. In fact, this has been a tough period for seniors due to the significant inflation resulting from the fallout of the Covid pandemic. High inflation is not good for people on a fixed income with conservative portfolios, which fits the description of most retirees.

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Still, seniors on Social Security can expect a record-breaking raise this year. Hopefully it will be the last one that's so high as inflation comes under control.