Social Security COLA for 2027 may jump to 4.7%, one estimate finds. This chart shows prices driving the increase

Consumer prices rose in May, pushing the annual inflation rate to its highest level in three years, according to new government data. That points to a 4.7% Social Security COLA for 2027, according to a new estimate from Mary Johnson, an independent Social Security and Medicare policy analyst. Last month, Johnson had forecast a 4.2% COLA for next year. "There's a considerable likelihood that it's going to climb even higher than 4.7% as data continues to come in, especially on the gasoline prices," Johnson said. The Social Security Administration typically announces the COLA for the following year in October, and the change is based on third-quarter data. Meanwhile, the Senior Citizens League, a nonpartisan senior group, now forecasts a 3.8% COLA for 2027, down from its 3.9% May estimate. The estimate did not note a reason for the decline, and the Senior Citizens League was not available for comment by press time. In 2026, about 75 million Social Security and Supplemental Security Income beneficiaries saw a 2.8% boost to their monthly checks through the cost-of-living adjustment. But while that increased the average $2,000 monthly benefit by about $56, beneficiaries would need $94 per month to keep up with inflation, according to Johnson. The annual COLA has averaged about 3.1% over the past decade, according to the Social Security Administration. Social Security's COLA is calculated using a subset of the consumer price index known as the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W. Broad CPI inflation rose 4.2% over the past 12 months as of May, the Bureau of Labor Statistics said on Wednesday. Meanwhile, the CPI-W is up 4.4% over the past 12 months. Price increases affecting the COLA forecast The categories that have seen the biggest jump in the CPI-W over the past 12 months include fuel oil, which has shot up 64.1%; gasoline, 40.7%; and airfare, 25%. Older Americans continue to grapple with higher costs. In the wake of the Covid-19 pandemic, inflation rose to new highs, prompting larger Social Security COLAs of 5.9% in 2022 and 8.7% in 2023. Yet while the pace of inflation subsided, bringing Social Security cost-of-living adjustments down in subsequent years, consumer prices have mostly stayed higher. A majority, or 69%, of adults ages 50 and over say they worry that prices are rising faster than their income, according to AARP's most recent financial security trends survey, fielded in January. Meanwhile, 61% of older Americans say the average $2,000 monthly Social Security payment is not enough, the survey found. There has been debate among experts and lawmakers as to whether the CPI-W accurately reflects the prices older Americans experience. To be sure, everyone has a personal inflation rate based on their individual spending needs and factors such as where they live. Beef and coffee are among the grocery categories with the highest inflation for the broader consumer price index. Yet the average price for a pound of beef varies based on location. In response to high food prices, seniors may be eating less frequently and substituting less expensive items for pricier ones, such as beef, to help curb their grocery costs, Johnson said.