October 15, 2025 will be a key date for millions of people in the United States. On that day, the Social Security Administration (SSA) will announce the desired Cost of Living Adjustment (COLA) for 2026. This adjustment directly affects the income of retirees, people with disabilities, and other beneficiaries.
What is COLA and why does it matter?
The COLA, or annual cost of living adjustment, is more than just a number. Its goal is to protect beneficiaries from inflation. In other words, it ensures that the money they receive each month keeps its real value, even if prices rise at supermarkets, pharmacies, or gas stations.
Without this adjustment, benefits could lose purchasing power year after year. That's why, for many retirees and people with disabilities, COLA is essential to keep their financial stability.
Who receives COLA
Not all Social Security beneficiaries receive exactly the same, but those who qualify for COLA include:
- Retired workers.
- People with disabilities.
- Survivors of deceased workers.
- Those who receive Supplemental Security Income (SSI).
If you're in any of these categories, the October 15 announcement will affect you directly.
How COLA is calculated
The calculation may sound complicated, but the idea is simple. SSA uses the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This index measures how prices of goods and services change in the economy.
The procedure is as follows:
- CPI-W data from the third quarter of the current year (July, August, and September) are averaged.
- That average is compared to the average from the third quarter of the previous year.
- The percentage increase between both averages determines the COLA for the following year.
This percentage is applied to the benefits of all who qualify, ensuring their money remains enough to cover their basic needs.
Key dates and tips
Although the official announcement will be on October 15, it's advisable to mark the calendar and plan ahead. Being aware of these dates helps avoid surprises and manage the family budget better.
Additionally, beneficiaries can review their payment history and make sure all their information with SSA is up to date. This ensures they receive the adjustment without delays or errors.