Social Security recipients received a 2.8% cost-of-living adjustment for 2026, up from 2.5% the year before. The Social Security Administration estimated the average retirement benefit would rise by about $56 a month, bringing the average monthly check from $2,015 to $2,071.
For many retirees living on fixed incomes, that number lands with a thud. Fifty-six dollars doesn’t cover a tank of gas, let alone a month’s worth of prescription copays.
Seniors Say It’s Not Enough
The frustration is widespread and well-documented. In an AARP survey conducted in September 2025, 77% of older adults said a 3% COLA for 2026 would not be enough to help them keep up with rising prices.
That’s a striking number, especially considering the 2026 adjustment didn’t even hit 3%. Retirees aren’t being dramatic. Groceries, utilities, housing, and medical costs have all climbed faster than the official inflation figures suggest for people in their 60s and 70s.
Why the COLA Formula Falls Short
The mismatch between what the COLA delivers and what retirees actually spend comes down to how the adjustment is calculated. Social Security benefits are adjusted using the Consumer Price Index for Urban Wage Earners and Clerical Workers, known as the CPI-W.
Because it tracks spending for workers rather than retirees, it doesn’t always reflect what older Americans actually buy. Medical care, housing, and long-term care tend to rise faster than the CPI-W basket, creating a gap between actual costs and the annual adjustment. That gap has been compounding for years.
Buying Power Has Been Eroding
Social Security benefits have lost 20% of their buying power since 2010, according to The Senior Citizens League, an advocacy group.
It means that the same monthly check that covered the bills fifteen years ago now covers meaningfully less, even after every annual adjustment is factored in. For retirees who don’t have a pension or significant savings to fall back on, that erosion is the difference between getting by and running short.
Congress Is Looking at a Temporary Fix
Two lawmakers and a senator have put forward one answer. Rep. John B. Larson, Rep. Steven Horsford, and Sen. Elizabeth Warren are promoting the Social Security Emergency Inflation Relief Act, which would provide a $200-per-month emergency increase in Social Security benefits from January 2026 to July 2026.
The temporary increase is designed to help Americans being squeezed by higher prices, and it would apply to all Social Security beneficiaries, including those receiving disability benefits.
What $200 a Month Actually Means
Two hundred dollars sounds modest, but for someone living on $2,000 a month, it’s a 10% bump. It could cover a Medicare Part B premium and leave money left over. The standard Medicare Part B premium increased to $202.90 per month in January 2026, up from $185, marking the first time premiums topped $200.
That increase alone wiped out a chunk of what the COLA added. The $200 relief proposal, if passed, would at least restore some of what higher Medicare costs took away.
Sanders Has a More Permanent Plan
Sen. Bernie Sanders, along with 10 co-sponsors, introduced the Social Security Expansion Act, which would also increase benefits by $200 per month but make that change permanent.
The bill also calls for using the Consumer Price Index for the Elderly in calculating annual COLAs. The CPI-E is specifically designed to track spending patterns for people 62 and older, weighting healthcare and housing more heavily than the current formula does.
The CPI-E Would Produce Modestly Higher Adjustments
Switching to the CPI-E wouldn’t transform retirement finances overnight, but the cumulative difference adds up. A change to the CPI-E could increase the annual COLA by about 0.2 percentage points on average.
For example, the 2026 COLA might have been 3% rather than 2.8% if the CPI-E had been used. Over a decade of retirement, those fractional gains compound into real money.
Skeptics Point to Solvency Concerns
Not everyone in Washington is convinced these proposals are realistic. The Social Security trust funds are facing depletion in less than a decade, and some experts say Congress is unlikely to change the COLA formula in a way that increases annual payments.
Steve Parrish, a professor of practice at the American College of Financial Services, said he doesn’t think the CPI-E switch has traction because “we’re already losing money,” and that a move to a chained CPI is more likely. The politics of Social Security expansion are complicated by the program’s long-term funding gap.
Relief, Not a Restructuring
Experts caution that the $200 monthly boost is a temporary measure and represents “short-term relief lacking a broader strategy to address the impact of inflation on recipients beyond July 2026.” Without structural change, the baseline benefit doesn’t improve long-term.
Still, for retirees trying to cover rising costs right now, a temporary boost and a serious conversation about how the COLA is calculated are both steps in the right direction. Whether Congress acts on either proposal remains an open question heading into the second half of 2026.
