This Wednesday, the Bureau of Labor Statistics (BLS) published its Consumer Price Index (CPI) report, which decreased 0.4%, placing year-on-year inflation at 3.5% in June, well below the 4.2% recorded in May.

And after knowing the report on the inflation rate, which turned out to be more moderate than expected, new estimates indicate that the 2027 Social Security cost of living (COLA) could have an increase between 3.6% and 3.8%.

The forecasts are debated with the American non-profit organization for people over 50, AARP, which predicts that next year's COLA will have an increase of 3.6%, while the Senior Citizens League (TSCL) predicts a 3.8% increase.

For many analysts like Mary Johnson of Social Security and Medicare, who tracks and calculates the cost of living adjustment (COLA) estimate, this unexpected and unusual drop in inflation in June is indeed significant, but she doubts that with continued geopolitical tensions the slowdown in inflation will continue.

“These monthly reviews can give an idea of ​​what the actual inflation data indicates for the third quarter, which can be helpful in making retirement financial decisions, such as renewing a certificate of deposit or creating a budget,” Johnson said.

For his part, Alex Moore, a statistician with the Senior Citizens League, noted that “inflation is quite unstable right now,” he said. Furthermore, specialists consider that, regardless of the COLA adjustment, the already anticipated increases in Medicare and drug costs will absorb this increase.

However, based on projected estimates of an average adjustment to 3.7%, benefits would increase by $74 per month in 2027 as opposed to $56 this year for the 2.8% adjustment.

In addition, an adjustment like the one AARP foresees would be one of the highest since 2022, when it stood at 8.7%; However, during that year the inflation rate reached some of its highest levels.