The 2.5% adjustment for next year translates into just $49 additional for the average retiree. Meanwhile, prices of basic products such as food and medicine continue to rise. If you depend on that retirement, you know that those 49 pesos are not enough to cover the increase in the supermarket. A hard blow, without a doubt.
But be careful, there is a ray of hope on the horizon: the COLA for 2026. Although the official figure is still a long way off, some experts are betting that it could be juicier than thought. Sure, that sounds good… doesn’t it? We’ll see why things are not so simple for retirees.
The Social Security COLA and the inflation that haunts us
The government uses an index called CPI-W, which measures inflation for urban workers. They compare the data from July, August, and September of the current year with that of the previous one, and bang!, the percentage increase comes out. By 2025, the difference was 2.5%, but here’s the detail: that index does not include retirees. Yes, as you hear it.
The Senior Citizens League (TSCL) organization strives to predict the COLA ahead of time. In January they talked about 2.1% for 2026, but in February they raised the projection to 2.3%. Translated into silver: the average check would go from $1,979 to $2,025 per month. Of course, their calculations have been almost divinatory (they failed by only 0.1% in 2025). Reliable? It seems so.
Here is the problem that concerns us: if the COLA rises, it is because inflation is already eating us alive. In other words, that “extra” increase is really just trying to compensate for what you already lost. Imagine running on a treadmill: you move, but you don’t move forward. Since 2010, profits have lost 20% of their purchasing power. 20%! It doesn’t matter if the check is bigger if everything costs twice as much.
Your retirement calculation could be wrong, some say
Another issue to consider is that the CPI-W does not consider the expenses that retirees have, which other younger or working-age people do not have. Older people invest more in health and less in technology, for example. If they used the CPI-E (an index made for them), the COLA would have been higher 7 of the last 10 years. Why don’t they change the formula? Good question, but SSA insists on staying attached to the CPI-W.
Some politicians have proposed using the CPI-E, but no one is taking action. The issue is entangled with the financing crisis of Social Security, which owes 23 billion dollars. Until they sort out that mess, it’s unlikely they’ll improve the formula. In the meantime, we have to hold on and hope that October 2025 brings less disappointing news.
How to increase your Social Security retirement check
To receive the maximum Social Security check in 2025 ($5,108 per month), you need to meet these 3 key requirements, which are below:
Work for 35 years earning the maximum taxable limit: Social Security calculates your benefit with your 35 years of highest income. To qualify for the maximum, you must earn $168,600 or more annually (taxable limit 2024, adjusted each year) for at least 35 years. If you work fewer years or earn less, the amount is reduced.
Delay retirement until age 70:
The “normal” retirement age is 67 (for those born in 1960 or later), but if you wait until 70, you accumulate late credits – an extra 8% annually! For example, if your base benefit is $3,800 at age 67, but if you wait until age 70 the payment would rise to about $4,700.
Again, don’t retire early:
If you request your check before age 70 (even at 67), you lose those credits. And if you retire before 67, the reduction is greater: up to 30% less if you retire at 62. Patience = $$$. The more years you have been close to the taxable limit, the more your average will rise. But to reach $5,108, you need to maximize your income for decades.
