According to the Federal Inflation data released this Tuesday, a new estimate indicates that the cost-of-living adjustment for Social Security in 2026 may increase by 2.6%.
The Social Security Administration will announce the cost-of-living adjustment for the coming year based on the Consumer Price Index data for July, August, and September. The cost-of-living adjustment for 2025 has already been set at a 2.5% increase. This means that inflation data starting from July will have a certain impact on the elderly.
Data released by the U.S. Department of Labor on Tuesday shows that the Consumer Price Index for June 2025 increased by 2.7% compared to the previous year, higher than the 2.4% annual increase in May.
On a monthly basis, June saw a 0.3% increase from May, whereas May only saw a 0.1% increase. The prediction by elderly organizations was made after the data released by the Department of Labor.
The White House rebutted claims that tariffs are exacerbating inflation, pointing out that despite imposing a 25% tariff on cars and a 50% tariff on steel and aluminum, new car prices have still decreased. The government also stated that although clothing prices slightly increased in June, overall they are cheaper than three months ago.
In a press release, the Senior Citizens League stated that due to increasing inflation pressures, their prediction model has been adjusted upwards for five consecutive months. This time, they increased their forecast for the cost-of-living adjustment from 2.5% last month to 2.6%. Previously, they had predicted a 2.5% cost-of-living adjustment for Social Security and Supplemental Security Income (SSI).
The organization stated, “There are still three months until the next cost-of-living adjustment announcement, and our model predicts that the 2026 cost-of-living adjustment will be only 0.1 percentage point higher than 2025’s 2.5%.”
Trump posted on Truth Social, saying, “Consumer prices are low. Cut rates now!!!”
He was referring to the benchmark interest rates set by the Federal Reserve, currently between 4.25% and 4.50%. For months, Trump has been urging the Federal Reserve and its chairman, Powell, to cut rates, sometimes hinting at the possibility of replacing Powell.
Earlier this year, Trump imposed a broad 10% tariff on all imported goods and an additional 30% tariff on goods from China. Last week, he threatened to impose a new 30% tariff on the European Union starting August 1st.
The inflation report and cost-of-living adjustment estimates were also released a week after Trump signed the “Beautiful Act,” which provides tax breaks for the elderly. Under this act, individuals aged 65 and above can claim an additional $6,000 deduction.
Shannon Benton, Executive Director of the Senior Citizens League, stated in a release on Tuesday, “This ‘Beautiful Act’ is a good start for providing economic assistance to American senior citizens. The next focus should be helping about 7.3 million elderly individuals who earn less than $1,000 per month, below the federal poverty line.” She also added that approximately 39% of recipients rely entirely on Social Security income for their livelihood.
According to a report released by the organization this month, as of May this year, around 74 million people are receiving Social Security and Supplemental Security Income.
This article contains some information provided by the Associated Press.