Social Security's 2026 Cost-of-Living Adjustment (COLA) Estimate Is Getting a "Trump Bump" -- Here's How Much Extra You Might Receive

Sean Williams, The Motley Fool

Sat, Jun 21, 2025, 3:44 AM 8 min read

• As many as nine out of 10 retirees rely on their Social Security income to cover some portion of their expenses.

• Estimates for Social Security's 2026 cost-of-living adjustment (COLA) are climbing, and President Trump's tariff and trade policy looks to be the culprit.

• Though an above-average COLA for a fifth-consecutive year would be welcome on paper, retirees continue to get the short end of the stick when it comes to annual raises.

• The $23,760 Social Security bonus most retirees completely overlook ›

Last month, Social Security's retired-worker benefit made history, with the average payout topping $2,000 for the first time since the program's inception. Although this represents a modest monthly benefit, it's nevertheless proved vital to helping aging workers cover their expenses.

In each of the prior 23 years, pollster Gallup surveyed retirees about their reliance on the Social Security income they're receiving. Between 80% and 90% of respondents noted it was a "major" or "minor" income source. In other words, only around one in 10 retirees could, in theory, make do without their Social Security check.

For an overwhelming majority of Social Security beneficiaries, nothing is more important than knowing precisely how much they'll receive each month -- and that begins with the program's annual cost-of-living adjustment (COLA), which is announced during the second week of October.

This year's COLA announcement will be of particular interest, with President Donald Trump's tariff and trade policies expected to directly affect how much Social Security beneficiaries will receive per month in 2026.

But before digging into the specifics of how President Trump's policies are expected to impact the pocketbooks of seniors, survivors, and workers with disabilities, it's important to understand the building blocks of what Social Security's COLA is and why it matters.

The program's COLA is effectively the "raise" passed along on a near-annual basis that accounts for the impact of inflation (rising prices) on benefits. For example, if a large basket of goods and services increased in cost by 3% from one year to the next, Social Security benefits would need to climb by a commensurate amount, or buying power for Social Security recipients would decrease.

In the 35 years following the issuance of the first retired-worker check in January 1940, COLAs were assigned at random by special sessions of Congress. Only a total of 11 COLAs were passed along during this timeline, with no adjustments made in the 1940s.