Social Security sets 3.6% COLA for 2027, lifting benefits in January

The Social Security Administration announced Wednesday that benefits will rise 3.6% in January 2027, an adjustment covering more than 72 million Social Security and Supplemental Security Income recipients, PLANADVISER reported.

Average monthly Social Security checks increase by about $75, lifting the average retired-worker benefit to $2,170 a month. A couple in which both spouses receive benefits averages $3,355 a month, up from $3,238.

The 3.6% figure tracks third-quarter inflation of 3.7%, published the same morning by the Bureau of Labor Statistics in the Consumer Price Index for All Urban Consumers. Recipients received 2.8% for 2026 and 2.5% for 2025.

Payments to about 7.3 million Supplemental Security Income recipients rise first, beginning December 29, 2026. The maximum monthly payment increases to $1,029 for an individual, from $994, and to $1,544 for a couple, from $1,491.

For clients still working, retirement earnings test limits also rise. The limit for those below full retirement age moves to $25,560 from $24,480; in the year a client reaches full retirement age, it moves to $67,920 from $65,160. Maximum earnings subject to the Social Security tax rise to $192,300.

Tim Grimsditch, a managing director at Unbiased, told PLANADVISER the adjustment is the largest since 2023 and cautioned against treating it as a raise. A COLA is built to keep benefits in step with inflation, he said, not to increase purchasing power. AARP CEO Myechia Minter-Jordan, also writing to PLANADVISER, said one in five older Americans have no retirement savings. She warned that what she called special interests in Washington still want to weaken or eliminate the COLA.