Every fall, retirees ask the same question: “How much is my check going up?” This year, we have the answer. The Social Security Administration announced a 3.6% cost-of-living adjustment, or COLA, for 2027. For the average retiree, that works out to about $75 more a month starting in January.
That’s good news. But after 30 years of doing this work, I’ve learned that a raise on paper and more money in your pocket aren’t always the same thing. So let’s walk through what’s changing and what it could mean for you.
What’s Changing in 2027
• Social Security and Supplemental Security Income (SSI) payments for about 76 million Americans will go up 3.6%. That includes nearly 72 million people on Social Security, who will see the increase starting in January 2027.1
• The average Social Security retirement benefit will rise by about $75 a month.1
• If you’d like to see your new amount online, create a my Social Security account by November 18. Paper notices go out in December to anyone not signed up for online notices.1
• Still working? The most you pay Social Security tax on goes up to $192,300, from $184,500.2
How the COLA Is Figured
The COLA is based on the change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of last year to the third quarter of this year. If prices don’t go up, there’s no COLA.3 Congress made these yearly adjustments automatic in the Social Security Amendments of 1972.
One thing to keep in mind: the COLA follows a national price index, not your household budget. Your own costs, especially for health care, may go up faster or slower than 3.6%.
Why This Raise Matters
For a lot of retirees, Social Security is a big part of the monthly budget. Among Social Security beneficiaries age 65 and older, 37% of men and 42% of women get half or more of their income from it.4 So even a modest increase makes a difference.
Don’t Forget About Medicare
Here’s where the “raise on paper” part comes in. Most people on Medicare have their Part B premium taken out of their Social Security check before it ever reaches the bank. The 2026 Medicare Trustees Report projects the standard Part B premium will go from $202.90 a month to about $209.50 in 2027, an increase of $6.60. Medicare is expected to confirm the official number in November.5
If that projection holds, part of your $75 raise goes right back out the door. And if you’re on a Medicare Advantage or Part D plan, your costs could change too. Medicare open enrollment runs October 15 through December 7, so now is the time to look at your plan.
A Note for My Union Members With a Pension
Social Security gets a raise in years when prices go up. Many pensions don’t. If your monthly pension is a set dollar amount with no COLA, it buys a little less each year as prices rise. Check your plan documents to see what yours does.
This is one of the things we weigh together when you’re deciding between a lump sum and a monthly annuity. Neither option is automatically better. It depends on your full picture, which is why I look at Social Security, your pension, and your 401(k) together, not one piece at a time.
Why It Helps to Have an Advisor in Your Corner
A COLA announcement is a good reminder that retirement income isn’t set it and forget it. Every year, something moves. Social Security goes up, Medicare costs change, tax brackets shift, and markets have good years and bad ones. Each change on its own may look small. Together, they can make a real difference in what you have to spend each month.
That’s where a good advisor earns their keep. It isn’t only about picking investments. It’s about having someone who:
• Looks at your Social Security, pension, 401(k), and savings as one plan, not separate pieces.
• Explains what news like this means for you, in plain language.
• Helps you plan ahead for rising costs, like health care, instead of reacting after the fact.
• Is there to answer your questions when something changes.
What Clients Say About Staying in Touch
Industry surveys of people who work with financial advisors show how much good communication matters:
• 88% said how often and how an advisor communicates matters when deciding whether to work with that advisor. About 22% wished their advisor reached out more often.6
• Clients who heard from their advisor often were more likely to say they had a clear understanding of their finances: 73% compared with 64% of those who heard from their advisor less often.6
• In a 2024 survey of nearly 800 advised clients, 75% said they had switched advisors or thought about switching in the past year.7
To me, that comes down to something simple. You should never have to wonder whether your advisor is paying attention, or be left on your own to figure out what a change like this means for you.
Questions About Your Retirement Income?
If you don’t have an advisor yet, or you’re not sure your current plan accounts for changes like these, I’d be glad to help you take a look at the full picture.
Call 877-997-7113 or visit pereirawm.com to get started.
Sources
1. Social Security Administration, “Social Security Announces 3.6 Percent Benefit Increase for 2027,” October 14, 2026. https://www.ssa.gov/blog/en/posts/2026-10-14.html
2. Social Security Administration, “2027 Cost-of-Living Adjustment (COLA) Fact Sheet.” https://www.ssa.gov/news/en/cola/factsheets/2027.html
3. Social Security Administration, “Cost-of-Living Adjustment (COLA) Information.” https://www.ssa.gov/news/en/cola/index.html
4. Social Security Administration, “Fact Sheet: Social Security,” 2024. https://www.ssa.gov/news/press/factsheets/basicfact-alt.pdf
5. 2026 Medicare Trustees Report projection, as reported in Forbes, “Social Security 3.6% Raise: What Does This Mean for Medicare Patients?” October 14, 2026. https://www.forbes.com/sites/richardmenger/2026/10/14/social-security-36-raise-what-does-this-mean-for-medicare-patients/
6. YCharts, “How Can Advisors Better Communicate with Clients?” survey of 671 people who work with a financial advisor, 2022. https://go.ycharts.com/hubfs/How_Can_Advisors_Better_Communicate_with_Clients.pdf
7. YCharts, “Advisor-Client Communication Survey,” 2024. https://go.ycharts.com/hubfs/YCharts_Advisor_Client_Communication_Survey_2024.pdf
This material is provided for informational and educational purposes only and is not intended as individualized investment, tax, legal, or retirement planning advice. Individuals should consult with their financial professional regarding their particular situation. Cetera Representatives and Cetera Wealth Services, LLC do not provide tax or legal advice. Consult your tax professional regarding your individual situation.