US Social Security benefits to rise by 3.6 percent in 2027

Retired Americans will see a $75 boost in monthly cheques as benefits rise amid widespread inflation challenges.

United States Social Security benefits will increase by 3.6 percent beginning in 2027, marking one of the largest cost-of-living adjustments (COLAs) of the decade.

The benefit bump will roll out in January for 72 million Social Security recipients, and on December 31, for nearly 73 million Supplemental Security Income (SSI) beneficiaries.

The social security programme is the largest federal social insurance framework in the country. The entitlement programme provides financial support for older adults and disabled people, as well as benefits for survivors of families of workers who have passed away. Funded through dedicated payroll taxes, it serves primarily as a federal pension system that replaces a portion of an individual’s pre-retirement income upon leaving the workforce.

The announcement comes as high US inflation continues to remain a persistent economic headwind, fuelled primarily by energy shocks from the ongoing wars in Ukraine and Iran, which have caused global energy market turmoil that has sent crude oil prices above $100 a barrel.

Most older adults in the US believe the COLA isn’t adequately keeping up with inflation, according to an AARP poll from September. That poll found that about three-quarters of those 50 or older disagreed with the idea that a 3.5 percent COLA in 2027 would be enough to keep up with rising prices.