U.S. Social Security Benefits to Rise 3.6% in 2027, Covering About 76 Million Recipients
Key Facts
The U.S. Social Security Administration announced a 3.6% cost-of-living increase for beneficiaries in 2027, covering Social Security recipients and people receiving Supplemental Security Income. The administration said the adjustment is based on the change in the Consumer Price Index for Urban Wage Earners and Clerical Workers between the third quarters of 2025 and 2026. It estimates the average benefit for a retired worker will rise from $2,094 to $2,170 a month, an increase of $76. The increase covers about 76 million Americans receiving Social Security or Supplemental Security Income benefits, according to the administration. The announcement comes as the ability of the two trust funds to finance full benefits over the long term remains under scrutiny, according to the administration’s annual report projections.
The increase applies to Social Security benefits payable in January 2027, payments received by about 72 million beneficiaries. Increases for about 7.3 million Supplemental Security Income recipients begin on December 31, 2026. The different dates mean the adjustment reaches both groups as the year turns, according to each program’s payment schedule. The administration allows beneficiaries with personal accounts to view adjustment notices online starting in late November, up to three weeks before paper notices arrive. Those who have not signed up for electronic notices will receive letters by mail in December, while their 2027 Medicare premium amounts will appear in their accounts’ Message Center starting in late November.
The 2027 increase is the largest annual adjustment since the 8.7% increase that took effect in January 2023. Benefits then rose 3.2% in January 2024, followed by 2.5% in January 2025 and 2.8% in January 2026, before the current 3.6% increase. The cost-of-living adjustment is calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers, rather than the all-items Consumer Price Index. The calculation compares the average data for the third quarter of one year with the average for the third quarter of the previous year, under the mechanism set by law. In its official notice, the administration tied the size of the increase to a 3.6% rise in the index between the third quarters of 2025 and 2026, rounded to the nearest tenth.
October data, released after the 2027 adjustment was calculated, showed the all-items Consumer Price Index rising 0.4% month over month after a 0.6% increase in September, while the core index, which excludes food and energy, rose 0.3%. The all-items index stood at 337.511 in October, compared with 331.147 for the index for Urban Wage Earners and Clerical Workers. On a not seasonally adjusted basis, the all-items index rose 0.2% during the month, and the index used to calculate the adjustment rose 0.1%. The administration says the index for Urban Wage Earners and Clerical Workers is the official measure used to calculate the adjustment, making the third-quarter comparison the basis for the 2027 increase. November index data are scheduled for release on December 10, 2026, at 8:30 a.m. Eastern time.
The annual increase comes amid expected financial pressures on Social Security programs. In its June 2026 trustees report, the administration projected that the combined reserves of the two trust funds would be able to finance full scheduled benefits through 2034, with 83% of benefits payable after the reserves are depleted. For the Old-Age and Survivors Insurance trust fund alone, the report projected that reserves would be depleted in the fourth quarter of 2032, with enough available then to pay 78% of benefits. The combined reserves of the two funds fell by $160 billion in 2025 to $2.56 trillion. The administration also projected that program costs would exceed annual income in 2026 and remain above income throughout the 75-year projection period.