The increase, while slightly above forecasts, is based on the CPI-W index, which tracks spending by workers, not retirees.
Advocacy groups argue this methodology systematically undercounts inflation experienced by seniors, eroding their purchasing power.
Proposals to use the CPI-E index, which reflects seniors' expenses, have stalled in Congress.
The persistent gap between official and real-world inflation poses a long-term threat to retiree financial security.
In an announcement that brought modest relief to millions, the Social Security Administration confirmed on October 24, 2025, that benefits will increase by 2.8 percent in 2026. The Cost-of-Living Adjustment (COLA), designed to protect the purchasing power of approximately 75 million Americans, will provide an average monthly raise of about $56. While the figure slightly exceeded some economists' forecasts, a deeper analysis reveals a persistent and alarming structural flaw. The method used to calculate this annual raise, critics argue, systematically underestimates the true inflation faced by retirees, functioning as a hidden tax that gradually diminishes their standard of living....<<<Read More>>>...
