Older Americans are allowed to sign up for Social Security starting at age 62. This means that many people end up collecting those benefits for several decades. It's for this reason that cost-of-living adjustments, or COLAs, are so important to Social Security recipients.

The purpose of Social Security COLAs is to make it possible for seniors getting benefits to maintain their buying power through the years. Over time, costs tend to rise. And working Americans are often able to boost their wages by snagging raises to keep up.

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For retirees on Social Security, working isn't always an option. So the only way for some retirees to see their income rise from one year to the next is to get a Social Security COLA.

Meanwhile, initial projections are calling for a smaller Social Security COLA in 2026 than in 2025. And that might be disappointing to you. But here's why it shouldn't be.

Where current 2026 COLA projections stand

At the start of 2025, Social Security benefits got a 2.5% COLA. And many seniors are hoping for a larger raise in 2026.

Based on inflation readings to date, the Senior Citizens League, a nonpartisan advocacy group, is projecting a 2.4% COLA for the new year. That's a hair below 2025's raise, and it would also, if accurate, constitute Social Security's smallest COLA in several years.

As the Senior Citizens League pointed out in conjunction with releasing its latest projection, high levels of inflation during the pandemic led to COLAs that were larger than average in the years following that crisis. But since inflation has been cooling, seniors shouldn't expect such a large COLA in 2026.

Next year's COLA could still increase, but that's not something anyone should want

Social Security COLAs are based on third quarter inflation readings. And since we're only in June, it's too soon to determine what 2026's raise will amount to.

It's possible that next year's Social Security COLA will come in higher than 2.4%. It might even beat the 2.5% COLA retirees got this year. But that doesn't mean a larger COLA is a good thing.

For next year's COLA to come in higher, it would take a surprising increase in inflation. And that's bad for workers and retirees alike.

Of course, a big fear is that tariff policies will lead to higher living costs, spurring an uptick in inflation. That could leave many people struggling to make ends meet.

Put another way, if inflation picks up and next year's Social Security COLA increases as a result, seniors aren't going to benefit financially. What they gain in the form of a larger raise, they'll lose in the form of paying more for most of their essentials.

So rather than hope for a larger COLA in 2026, what retirees should actually hope for is a change to the way those raises are calculated. Using a more senior-specific index that measures changes in retiree costs like healthcare could lead to more generous COLAs in future years without requiring a scenario where everyone struggles due to inflation.