The latest inflation data may signal a modest cost-of-living adjustment (COLA) for Social Security recipients, according to a new projection. 

The Consumer Price Index released Tuesday reported inflation easing to 3.5% for the 12 months ending in June, down from 4.2% for the 12 months ending in May. 

Seniors on Social Security saw a 2.8% cost-of-living increase in benefits for 2026.

Payments are adjusted each January to reflect rising consumer costs. The Senior Citizens League, a nonpartisan senior advocacy group, estimates the 2027 Social Security COLA will be 3.8%, a full percentage point higher than this year’s boost. That matches the group’s May estimate and is down slightly from its 3.9% forecast in April. It’s a big jump from the 2.8% increase TSCL projected earlier this year.

A 3.8% increase in benefits would raise the average Social Security check by about $74, from an estimated $1,938 to $2,011, the TSCL said.

The average COLA increase over the past 10 years has been 3.1%. 

Read more: How to find out your 2026 Social Security COLA increase

COLA increases often lag inflation reports

Still, continued changes in the CPI may affect that estimate before the Social Security Administration announces the official COLA adjustment for 2027 in October. 

Energy costs play a significant role in consumer costs, and the June CPI report found that those expenses dipped during the short-lived Middle East ceasefire. As the conflict has reignited, gasoline prices have bounced higher.

The benefit increases tied to rising costs often fall behind the reported inflation rate, according to the TSCL. 

“Only 10% of seniors are happy with the amount they receive from their monthly Social Security checks, with many citing COLAs that lag inflation as a problem,” the TSCL wrote in an analysis published after the 2026 COLA increase announcement. 

Read more: When will you get your Social Security check? Payment schedule for July.

Worries continue about Trust Fund depletion

And then there are continuing concerns about the financial viability of the Social Security Trust Fund. 

“Due to demographic changes and unexpected economic developments, Social Security benefit obligations have been larger than tax revenue for about 15 years now,” Stephen Nuñez of the Roosevelt Institute wrote in a January analysis. “The question is not whether we can fix Social Security, but rather who will bear the costs when we do.”

A bipartisan group of U.S. senators introduced a bill Tuesday to address the looming shortfall. While the legislation, called the Promise Act, doesn’t offer any solutions, it calls on a seven-member board to draft a bill that would. 

To learn first-hand the financial challenges facing the system, the American Academy of Actuaries hosts the Social Security Challenge. The web-based app explains how Social Security works and lets users choose options to address the trust fund shortfall.