Social Security trust fund projected to run dry in less than 10 years
The main trust fund used to pay Social Security benefits is projected to be depleted by 2033 if lawmakers make no changes to the system.
Straight Arrow News
If not for the government shutdown, Social Security beneficiaries would have discovered the extent of the COLA hike for 2026 when new inflation data was released Oct. 15.In 2025, Social Security and Supplemental Security Income benefits for more than 72.5 million people went up by 2.5%.The COLA hike in 2026 could be slightly bigger than the one in 2025.
Seniors who are eager to figure out the new cost-of-living adjustment for Social Security benefits are going to need to wait a bit longer than expected.
Under normal circumstances, Social Security beneficiaries would have discovered the extent of the COLA hike for 2026 after the new inflation data was released by the U.S. Bureau of Labor Statistics on Oct. 15.
Shortly afterward, the Social Security Administration press office would typically release the much-anticipated COLA number once inflation data for September was announced.
All that was thrown into flux with the federal government shut down Oct. 1 after a budget battle in Congress. We didn’t see any inflation figures released on Oct. 15, as originally expected.
We weren’t sure when the data would be released. Yet on Oct. 10, the U.S. Bureau of Labor Statistics announced that the September Consumer Price Index will be released at 8:30 a.m. Friday, Oct. 24.
No other releases will be rescheduled or produced until the resumption of regular government services, according to the Bureau of Labor Statistics.
“This release allows the Social Security Administration to meet statutory deadlines necessary to ensure the accurate and timely payment of benefits,” BLS stated.
Even so, we won’t know how much of a COLA jolt retirees and others receiving Social Security benefits might see in 2026 until the official number is released.
Mary Johnson, an independent Social Security and Medicare policy analyst, said the Social Security Administration must make its COLA announcement by Nov. 1 in order to meet statutory deadlines.
Social Security typically mails COLA notices for the next year throughout the entire month of December.
The highest COLA increase for Social Security during the most recent bout of inflation was an 8.7% jump in 2023. But analysts are pegging the potential change in 2026 to around 2.7% or 2.8%.
Johnson said she’s forecasting a 2.8% inflation-adjustment for Social Security beneficiaries, given where she expects for September inflation data to land. Â
The Senior Citizens League, a nonpartisan advocacy group, is projecting that the 2026 COLA increase would be 2.7%. The final COLA figure will depend on the release of inflation figures for September, which is being delayed due to the federal government shutdown.
Seniors, of course, would like to get some estimate of how much their benefits could go up as soon as possible.
“It’s deeply concerning that critical information needed for their financial planning is being held up due to political gridlock,” said Shannon Benton, executive director of the Senior Citizens League, which was established in 1992.
“This isn’t a routine administrative delay — it’s a disruption that leaves real people in uncertainty, struggling to budget for essentials like rent, groceries, medications, and healthcare without knowing what their income will be in 2026.”
A 2.7% COLA hike would translate into roughly an average increase of $50 a month for all beneficiaries beginning in 2026 — or roughly $600 a year.
The average monthly payment, based on August figures, was $1,864.64 for all Social Security beneficiaries.
Some retirees might be looking at an extra $54.22 month beginning in 2026 — if they receive the average benefit of $2,008.31 a month for retired workers and the COLA hike is 2.7%.
In 2025, Social Security and Supplemental Security Income benefits for more than 72.5 million people went up by 2.5%.
The annual cost-of-living adjustment for Social Security benefits is based on how inflation is running in the third quarter. The formula reflects monthly changes for July, August and September for the Consumer Price Index for Urban Wage Earners and Clerical Workers.
Unfortunately, some other key costs are likely to go up in 2026.
Johnson warns that retirees likely will run into a nasty surprise when it comes to an anticipated jump in their costs for Medicare Part B premiums.
It’s possible, Johnson said, that seniors might see the biggest jump — looking at the dollar amount, not percentages — in the history of the program. Â
The Medicare Trustees report forecast that the 2026 Medicare Part B premium would rise from $185 in 2025 to $206.50 per month in 2026. That would be an increase of $21.50.
If the actual increase announced later this year is slightly a bit higher, it could beat a $21.60 a month increase that hit in 2022.
Benton, of the Senior Citizens League, said a hold harmless provision will ensure that Social Security checks do not decrease, as a result of the Medicare increase. The increase in Medicare Part B premiums is limited, she said, to the amount of a recipient’s COLA.
“So benefits never go down due to rising health care costs, but the hike may cause a zero increase from the COLA” at some times, she said.
Contact personal finance columnist Susan Tompor: stompor@freepress.com. Follow her on X @tompor.