Summary
Social Security recipients may receive a smaller-than-hoped cost-of-living adjustment (COLA) in 2027 as inflation cools. Earlier forecasts approached 5%, but recent estimates have fallen to 3.6% from the Senior Citizens League and 3.4% from analyst Mary Johnson. The final adjustment could decline further if August inflation data shows continued moderation. Even a higher COLA may not adequately protect retirees because Social Security uses the CPI-W, which does not reflect seniors’ spending patterns. The formula has contributed to significant losses in purchasing power over the past decade. Retirees can prepare by cutting expenses, downsizing housing, or earning supplemental income through part-time work.
The Motley Fool
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