"COLAs happen in the majority of years (although not every year). They are also known as Social Security raises, and they are a crucial component of the Social Security benefits program because they increase benefits in order to help retirees cope with inflation. Inflation is a natural part of life, with prices rising over time. But, since goods and services inevitably get more expensive as time goes on, seniors need to have their retirement benefits adjusted upward to avoid losing buying power."
"The Cost of Living Adjustment is announced in October of each year to alert seniors to the amount of extra money that will be coming in their upcoming checks. The COLA that's announced in October will take effect for 2026 Social Security payments, so retirees need to watch the news carefully on the 15th to find out what their finances will look like next year."
Social Security's annual Cost of Living Adjustment (COLA) will be announced on October 15, 2025, and will determine benefit increases that take effect for 2026 payments. COLAs occur in most years to raise benefits and help retirees cope with inflation by preserving buying power as prices rise. Concerns exist that the COLA formula may not fully address cost pressures, but the adjustments typically increase retiree income. Retirees should monitor the October announcement to understand how much extra will be added to upcoming checks and to plan household finances for the coming year.
Read at 24/7 Wall St.
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