The Social Security Administration (SSA) announced that the annual cost of living adjustment (COLA) for 2026 is 2.8 percent, up from a 2.5 percent increase in 2025. Employees at the Bureau of Labor Statistics (BLS) were called back from furlough to calculate the COLA.

SSA says the bump translates to an additional $56 a month on average, resulting in an average monthly check of $2,071. Married couples will see an average increase of $88, boosting their monthly benefit to $3,208 starting with the January 2026 paychecks.  

The annual COLA is meant to keep annuities for federal retirees and Social Security beneficiaries on pace with rising inflation.

Federal employees who enrolled in the Civil Service Retirement System (CSRS) will receive the full 2.8 percent increase. However, retirees who entered federal service after the start of the Federal Employees Retirement System (FERS), will receive just a two percent increase. 

Employees in FERS receive benefits based on a formula, and when COLA is between two and three percent, FERS annuitants receive a two percent COLA. 

That did not sit well with the National Active and Retired Federal Employees Association (NARFE).

“With inflation above 2%, FERS retirees will have their COLAs capped, reducing the real value of their annuities,” said NARFE National President William Shackelford. “Inflation impacts these FERS retirees the same way as all other retirees, yet they are forced to accept a diet COLA . . . This COLA also does not adequately compensate for the sharp increase in the enrollee share of health insurance premiums affecting the federal community, which will rise by an average of 12.3% next year for federal annuitants, following a 13.5% increase for 2025.”

Congressional Democrats have introduced legislation to ensure that all federal retirees receive a full COLA. The Equal Cola Act (H.R. 491) for example would standardize the annuities for CSRS and FERS. That legislation is currently pending in the House. Introduced by late Representative Gerry Connolly (D-VA), sponsorship was taken over by Connolly’s successor, Representative James Walkinshaw (D-VA).