President Donald Trump’s recently implemented tariffs could have significant effects on the upcoming cost-of-living adjustment (COLA) for Social Security benefits.

The COLA will impact benefits starting in 2026 and is based on the inflation levels of the prior year.

Why It Matters

Trump’s tariffs have led to trade tensions between the United States and other countries while boosting prices on many items and overall inflation.

However, the tariffs also could lead to higher monthly payments for more than 70 million Americans who receive Social Security benefits.

What To Know

Trump’s 10 percent global tariff, plus the higher “reciprocal” tariffs on several more countries, has led to price upticks on several items and inflation more generally.

Due to this, it is likely the next COLA will be higher, shifting benefit amounts up in the process. However, that’s not necessarily good news for seniors, experts say.

“The ‘Trump bump’ is the cruelest kind of ‘raise.’ Tariffs are pushing prices up roughly 2.3 percent in the short run, which inflates the COLA seniors get,” Michael Ryan, a finance expert and the founder of MichaelRyanMoney.com, told Newsweek. “So yes, checks go up a bit more than they would have. But here’s what the headlines miss: the same inflation driving that bump is eating the buying power before the check even clears.

The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter (July, August, and September) is used to calculate the COLA. 

While next year’s adjustment is typically announced on October 15, the standstill between Republicans and Democrats and larger government shutdown will likely cause a delay in announcing the new benefit amounts for seniors and disabled Americans.

So far, the senior advocacy group The Senior Citizens League (TSCL) has predicted a 2.7 percent COLA for 2026.

“Beneficiaries should expect anything in the range of a 2.7 percent to 2.9 percent increase on their Social Security benefits to be announced in the coming week,” Kevin Thompson, the CEO of 9i Capital Group, told Newsweek.

What People Are Saying

Ryan told Newsweek: “The COLA formula is backward looking by design. Meanwhile, tariff-driven price spikes hit now. Seniors spend January through September paying elevated prices on imports, then get a retroactive adjustment in October that might cover 70-80 percent of what they’ve already lost.”

Thompson told Newsweek: “Inflation still remains an issue for not only social security beneficiaries but also the Federal Reserve’s mandate.  This also may put more stress on the social security trust fund as more money comes out of the system.  For many seniors, this represents an increase but not nearly enough to offset the rising cost of Medicare as premiums continue to move higher across the board far above the rate of inflation.”

Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek: “The ‘bump’ isn’t really a good thing, as we’ve seen by other COLA increases in recent years. While beneficiaries are getting more in their checks, that extra amount is meant to offset the increase in prices across the board. In other words, it’s not so much a raise as simply keeping up with inflation.”

What Happens Next

A higher COLA will also lead to higher Medicare Part B premiums, which are deducted from Social Security, Ryan said.

“So that ‘bump’ shrinks before it reaches most retirees’ bank accounts. You’re basically watching your left pocket give money to your right pocket while inflation picks both,” Ryan said.

“This is far from a windfall. It’s a cost-of-living adjustment, not a cost-of-living advantage. Seniors aren’t getting ahead, they’re barely treading water in choppier seas.”