Even if Social Security payments are still being made, a crucial deadline for recipients is probably going to pass without an anticipated announcement. We are currently in the second week of a government shutdown in the United States that has no apparent conclusion in sight.
Usually published in mid-October, the annual Social Security cost-of-living adjustment, or COLA, takes effect at the start of the subsequent year. The announcement of the 2026 COLA hike was scheduled for October 15.
However, Chris Orestis, president of retirement planning website Retirement Genius, stated that the government shutdown “is going to delay that announcement.”
It will take some time for the Social Security Administration to obtain the information it requires from the Bureau of Labor Statistics to calculate the COLA, even if the closure ends today.
Here is a little explanation of how it operates: The Consumer Price Index, or CPI, is a measure of prices and inflation that is released by the BLS. The CPI-W, one component of the CPI, measures average prices for products bought by urban wage earners and clerical workers (essentially, individuals who work in cities). In order to assess if a COLA is required and at what level, the SSA utilizes data from the third quarter of the year and follows overall inflation based on prices in the CPI-W.
On the fifteenth of each month, the CPI-W is typically updated. However, because of the shutdown, the SSA and the BLS are also closed. The final COLA increase will be determined by the SSA after BLS staff have run the CPI-W statistics when the government reopens.
However, this does not imply that the real rise will be postponed. If the SSA decides that a COLA is necessary, it makes the announcement in the middle of October. However, the increase isn’t implemented until the start of the subsequent year.
The implementation of an increase in benefits may be postponed if the government remains closed until early 2026. However, that is not likely. During President Donald Trump’s first term in 2018, the longest government shutdown in history began and lasted for 35 days. The announcement of the COLA did not coincide with it.
However, another government shutdown occurred in 2013 and lasted from October 1 to October 17. About two weeks later, on October 30, the SSA COLA announcement and the BLS report were released, and the raise was implemented on January 1 of the following year.
“The only thing that could prevent a COLA increase in January is if the government wasn’t operational by the start of the new year,” Orestis stated. “We live in a completely different world if the government isn’t operational by January 1st.”
Social Security users should still anticipate receiving their rise in the new year as planned, according to Martha Shedden, co-founder and president of the National Association of Registered Social Security Analysts.
In September, the nonprofit advocacy organization Senior Citizens League predicted that the rise this year would be 2.7%. That would be somewhat more than the 2.5% increase from the previous year.
The cause of that is an increase in inflation.
Orestis stated, “Trump made a big promise that he would eliminate inflation and lower prices, but in reality, it has increased.”
The COLA is applied to your primary insurance amount, which is the monthly total assuming you begin receiving Social Security at the age at which you are eligible for full benefits, rather than your total benefit amount. Multiplying it by 1.027 will give you a rough idea of what your new benefit will look like with a 2.7% increase. The COLA from the previous year increased monthly benefits by about $50 per participant.