The Social Security Administration is expected to announce the official 2026 cost-of-living adjustment (COLA) this October, and early forecasts suggest benefits could rise between 2.4% and 2.7%. For the average retiree, that would mean an increase of $48 to $54 per month—welcome news for millions of Americans who rely on Social Security as a key part of their retirement income.

While any increase in benefits is a step in the right direction, it’s important to understand the full picture. The COLA is based on the CPI-W, a measure of inflation tied to urban wage earners’ spending habits. However, retirees often face higher costs in areas like housing and healthcare, which are rising faster than the overall CPI-W. As a result, some experts believe the 2026 adjustment may still fall short of keeping up with the real-world expenses many seniors face.

That said, this is also a great opportunity to be proactive. Social Security remains a critical part of some retirees financial strategy, but it works best when integrated with other income sources—such as retirement accounts. Even a modest increase in benefits, when paired with smart planning, can help you maintain your lifestyle, manage inflation, and continue working toward your legacy goals.

At XML, we believe knowledge is power, and planning ahead can be the key to long-term financial confidence. If you’re wondering how the upcoming COLA—and future changes to Social Security—might impact your retirement or legacy planning, now is the perfect time to review your strategy with your advisor.

Check out the full article from The Motley Fool to read more. 

Have questions about how these insights and ideas could impact your personalized wealth management strategy? Let’s talk.

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