The Social Security Act of 2026 exists but 77% of older Americans say it’s not enough — here’s what you can do

The Social Security Administration announced that Social Security recipients will see their monthly checks increase by 2.8% in 2026. For the average retiree collecting $2,008 per month, COLA translates to an additional $56, bringing their monthly benefit to $2,064.

But most older Americans say that’s still not enough: 77% told AARP that the increase is not keeping pace with rising prices, a rare issue that crosses party lines.

Here’s why seniors in the US feel the 2026 COLA is inadequate, and what you can do about it.

Why Social Security’s COLA doesn’t cover what retirees might need

The perception gap stems in part from the extent to which household budgets vary across age groups and employment status. Social Security calculates its annual COLA using the Consumer Price Index (CPI) for urban wage earners and clerical workers, which tracks price changes for working individuals living in urban areas.

Many seniors say they need more. When AARP asked them what raise would help them with daily living expenses, 72% said they would need a 5% or higher raise, and 26% said they would need a full 8% just to keep up with their true costs.

“For retirees who rely heavily on Social Security, a small gap between COLA and true costs of living can make a difference,” said Gina Seibert, chief financial officer at PSECU. Investopedia. “Over time, this shortage can result in sooner savings or reduced discretionary spending to manage necessities like housing, food, and medical expenses.”

How to bridge the gap between COLA and rising costs

Given the difference between formal COLAs and expected cost increases, financial experts recommend several strategies for current and future retirees.

Consider delaying benefits

Every year someone delays receiving benefits beyond full retirement age (usually age 67 for those born in 1960 or later), their benefits increase by about 8%, until age 70. A person who waits until age 70 instead of claiming at age 67 will receive approximately an additional quarter each month for life, and future COLA aid will increase based on that higher amount.

Diversify sources of income

“Regularly reviewing your budget and prioritizing essential expenses is key to maintaining stability,” Seibert said. “Retirees can also look for ways to supplement income – whether through part-time work, investment earnings, or community resources designed to support older adults.”

Financial advisors generally recommend targeting your total retirement income — including Social Security, pensions and personal savings — to replace about 70% to 80% of your pre-retirement earnings. Social Security typically replaces between 35% and 40% of the average worker’s pre-retirement income, meaning retirees need additional resources to fill the gap.

Building a diversified portfolio that includes 401(k), individual retirement accounts (IRAs), pension income, and taxable investment accounts can provide a buffer when COLAs are less than actual cost increases.

Reduce fixed expenses before retirement

Since housing represents a large portion of retirees’ budgets, reducing or eliminating housing costs before retirement can alleviate many of the budget issues you face.

Debt management

“Paying off high-interest debt and using budgeting tools can make managing monthly finances easier and more predictable,” Seibert said.

Bottom line

A 2026 Social Security COLA of 2.8% would provide some inflation assistance to about 70 million beneficiaries. However, the vast majority of older Americans surveyed by AARP said that is not enough.