Social Security's 2027 COLA Is on Pace to Be Historic and Devastating, Courtesy of President Donald Trump

Last year was filled with history-making moments for America's leading retirement program, Social Security. In addition to Social Security celebrating its 90th "birthday," 2025 marked the first time that the average monthly retired-worker benefit exceeded $2,000.

History was made this year, as well, with a fifth consecutive year in which Social Security's cost-of-living adjustment (COLA) met or surpassed 2.5% -- something that hadn't been witnessed in almost three decades. Social Security's COLA is essentially the annual raise given to beneficiaries to counter the effects of inflation (rising prices) and prevent a loss of purchasing power.

Early independent estimates suggest that Social Security's 2027 COLA will be historically high, thanks in part to decisions made by President Donald Trump. However, a beefier raise comes with potentially devastating consequences for America's top retirement program.

This may be the fourth-highest COLA in the last 36 years

When the prevailing inflation rate rises, so does Social Security's cost-of-living adjustment. While a modest level of inflation is normal and healthy for the U.S. economy, two policy decisions by President Trump have provided a boost to inflation, and thus Social Security's 2027 COLA forecast.

https://finance.yahoo.com/economy/policy/articles/social-securitys-2027-cola-pace-105600481.html