The 2027 Social Security COLA Projection and the Other Half of the Story

What the headline number doesn’t include — and why it matters for your budget

The 2027 COLA looks good on paper. Here’s what happens to it in practice.

The good news is that your Social Security check is projected to increase by 3.8% in 2027.

The bad news is that rising Medicare costs and inflation will eat up most of it.

That’s not pessimism. That’s the pattern — and it has been repeating itself for years.

The Numbers

The 3.8% hike is the forecast from The Senior Citizens League (TSCL), a nonpartisan senior advocacy group.

On a Social Security benefit of $2,000 per month, that’s an increase of roughly $76.

Seventy-six dollars a month-$912 a year.

That sounds like something. And it is — until you look at where it goes.

Now, the Bad News

Medicare Part B premiums are deducted directly from your Social Security check before it hits your account. When the COLA goes up in January, the Part B premium usually goes up right alongside it.

If history is a guide, the Medicare increase comes in at a much higher percentage.

You saw this in 2026. The Part B premium jumped from $185 to $202.90 — a $ 17.90-per-person increase. That’s a 9.675% hike. For a couple, that’s $35.80 a month gone before you spend a dollar.

The 2026 COLA increase was 2.8%. The Part B increase alone consumed more than 25% of it.

For 2027, Part B premiums haven’t been finalized yet — that announcement comes in the fall. But the trajectory is not encouraging.

Thinking long term, analysts project Part B could reach $360.60 per month by 2035 — a 77% increase from today’s level. Every year, the premium climbs, taking a bigger bite out of whatever increase Social Security delivers.

Add whatever hike your supplemental plan decides on, and Part D prescription drug costs on top of that, and the math gets tighter still.

Shoveling Against the Tide

Here’s the number that puts it all in perspective.

According to the Senior Citizens League’s 2026 Loss of Buying Power report, the average Social Security benefit has lost approximately 13.7% of its buying power since 2010. Benefits are worth about 86 cents on the dollar compared to a decade ago.

The COLA was never designed to get you ahead. It was designed to keep you even. And most years it doesn’t even do that — because the index used to calculate it, the CPI-W, measures spending patterns of urban wage earners, not retirees.

Healthcare and housing — the expenses that hit seniors hardest — aren’t weighted heavily enough to reflect what retirement actually costs.

So the COLA chases the wrong inflation number, Medicare takes its cut off the top, and the gap quietly widens.

Plan Ahead

COLA is what it is. You can’t negotiate it. But you can plan around it.

Don’t budget the raise before it arrives. Wait until the Part B premium is announced in October before you count on that $76.

Last year’s COLA looked better before the Medicare increase hit.

If you’re not already on Medicare, factor the annual premium increase into your retirement healthcare budget — not just the current number, but where it’s likely to be five and ten years from now.

And if your budget is already tight, this is the time to revisit your expense audit. Or, find additional income.

COLA giveth and Medicare taketh away. The gap has to come from somewhere.

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