The Social Security cost-of-living adjustment for 2026 is projected to be the lowest increase that millions of beneficiaries have seen in recent years.

This could change, however, due to potential inflationary pressures from tariffs. 

Recent estimates for the 2026 COLA, based latest government inflation data, place the adjustment to be around 2.2% to 2.3%, which are below the 2.5% increase that went into effect in 2025.

The COLA for 2026 may be 2.2%, estimates Mary Johnson, an independent Social Security and Medicare analyst. Meanwhile, the Senior Citizens League, a nonpartisan senior group, estimates next year’s adjustment could be 2.3%.

If either estimate were to go into effect, the COLA for 2026 would be the lowest increase since 2021, when beneficiaries saw a 1.3% increase.

As the Covid pandemic prompted inflation to rise, the Social Security cost-of-living adjustments rose to four-decade highs. In 2022, the COLA was 5.9%, followed by 8.7% in 2023 and 3.2% in 2024.

The 2.5% COLA for 2025, while the lowest in recent years, is closer to the 2.6% average for the annual benefit bumps over the past 20 years, according to the Senior Citizens League.

To be sure, the estimates for the 2026 COLA are indeed preliminary and subject to change, experts say.

The Social Security Administration determines the annual COLA based on third-quarter data for Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W.

New government inflation data released on Thursday shows the CPI-W has increased 2.2% over the past 12 months. As such, the 2.5% COLA is currently outpacing inflation.

Yet that may not last depending on whether the Trump administration’s plans for tariffs go into effect. Trump announced on Wednesday that tariff rates for many countries will be dropped to 10% for 90 days to allow more time for negotiations.

If the tariffs are implemented as planned, economists expect they will raise consumer prices, which may prompt a higher Social Security cost-of-living adjustment for 2026 than currently projected.

“We could see the effect of inflation in the coming months, and it could very well be by the third quarter,” Johnson said.

If that happens, the 2026 COLA could go up to 2.5% or higher, she said.

Retirees are already struggling with higher costs for day-to-day items like eggs, according to the Senior Citizens League. Meanwhile, new tariff policies may keep food prices high and increase the costs of prescription drugs, medical equipment and auto insurance, according to the senior group.

Most seniors do not feel Social Security’s annual cost-of-living adjustments keep up with the economic realities of the inflation they personally experience, the Senior Citizens League’s polls have found, according to Alex Moore, a statistician at the senior group.

“Seniors generally feel that that the inflation they experience is higher than the inflation reported by the CPI-W,” Moore said.

When costs are poised to go up and the economic outlook is uncertain, seniors may be more likely to feel financial stress because their resources are more fixed and stabilized, he said.

The impact of President Donald Trump’s tariff agenda and resulting trade war will translate to higher consumer prices by summer, economists said.

“I suspect by May — certainly by June, July — the inflation statistics will look pretty ugly,” said Mark Zandi, chief economist at Moody’s.

Tariffs are a tax on imports, paid by U.S. businesses. Importers pass on at least some of those higher costs to consumers, economists said.

While economists debate whether tariffs will be a one-time price shock or something more persistent, there’s little argument consumers’ wallets will take a hit.

Consumers will lose $4,400 of purchasing power in the “short run,” according to a Yale Budget Lab analysis of tariff policy announced through Wednesday. (It doesn’t specify a timeframe.)

In fact, in a “darkly ironic” way, the specter of a global trade war may have had a “positive” impact on inflation in March, Zandi said. Oil prices have throttled back amid fears of a global recession (and a resulting dip in oil demand), a dynamic that has filtered through to lower energy prices, he said.

“I think it’ll take some time for the inflationary shock to work its way into the system,” said Preston Caldwell, chief U.S. economist at Morningstar. “At first, [inflation data] might look better than it will be eventually.”

But consumers will start to see noticeably higher prices by May, if the president keeps tariff policy in place, said Thomas Ryan, an economist at Capital Economics.

“Price increases take time to filter through the supply chain (starting with producers, then retailers/wholesalers, and finally consumers),” Ryan wrote in an e-mail.

Capital Economics expects the consumer price index to peak around 4% in 2025, up from 2.4% in March. That peak would be roughly double what the Federal Reserve aims for over the long term.

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Most physical goods, such as vehicles, consumer electronics, clothing and furniture, are expected to be pricier by Memorial Day, Zandi said.

Additionally, retailers and wholesalers “won’t want to do this all at once,” Ryan said.

They’ll likely sprinkle in higher prices over time to blunt backlash from consumers, Ryan said. Consumer prices “will reflect more of the true impact of tariffs” in May and beyond, he said.

There’s also the possibility that some companies may try to front-run the impact of tariffs by raising prices now, in anticipation of higher costs, Ryan said.

It would be a gamble for companies to do that, though, Caldwell said.

“Any company that kind of sticks its neck out first and increases prices will probably be subject to political boycotts and unfavorable attention,” he said. “I think companies will move pretty slowly at first.”

The Trump administration recently announced that it would begin a process of overhauling the country’s $1.6 trillion federal student loan system.

The potential changes could impact how millions of borrowers repay their debt, and who qualifies for loan forgiveness.

“Not only will this rulemaking serve as an opportunity to identify and cut unnecessary red tape, but it will allow key stakeholders to offer suggestions to streamline and improve federal student aid programs,” said Acting Under Secretary James Bergeron in a statement on April 3.

Around 42 million Americans hold federal student loans.

Here are three changes likely to come out of the reforms, experts say.

Former President Joe Biden rolled out the SAVE plan in the summer of 2023, describing it as “the most affordable student loan plan ever.” Around 8 million borrowers signed up for the new income-driven repayment, or IDR, plan, the Biden administration said in 2024.

The plan has been in limbo since last year, and in February a U.S. appeals court blocked SAVE in February. The 8th U.S. Circuit Court of Appeals sided with the seven Republican-led states that filed a lawsuit against SAVE, arguing that Biden was trying to find a roundabout way to forgive student debt after the Supreme Court struck down his sweeping loan cancellation plan in June 2023.

SAVE came with two key provisions that the legal challenges targeted: It had lower monthly payments than any other federal student loan repayment plan, and it led to quicker debt erasure for those with small balances.

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The Trump administration is unlikely to continue to defend the plan in court, or to revise it in its regulations, experts say.

“It’s difficult to see any scenario where SAVE will survive,” said Scott Buchanan, executive director of the Student Loan Servicing Alliance, a trade group for federal student loan servicers.

For now, many borrowers who signed up for SAVE remain in an interest-free forbearance. That reprieve will likely end soon, forcing people to switch into another plan.

The IDR plans now open are: Income-Based Repayment, Pay As You Earn and Income-Contingent Repayment, according a recent Education Department press release.

As a result of Trump administration’s revisions, two of those plans — PAYE and ICR — no longer conclude in automatic loan forgiveness after 20 or 25 years, Buchanan said, noting that the courts have questioned the legality of that relief along with SAVE.

The Trump administration, through its changes to the student loan system, is likely to make at least some of those temporary changes permanent, said higher education expert Mark Kantrowitz.

Still, if a borrower enrolled in ICR or PAYE switches to IBR, their previous payments made under the other plans will count toward loan forgiveness under IBR, as long as they meet the plan’s other requirements, Kantrowitz said. Some borrowers may opt to take that strategy if they have a lower monthly bill under ICR or PAYE than they would on IBR.

President Donald Trump signed an executive order in March that aims to limit eligibility for the popular Public Service Loan Forgiveness program.

PSLF, which President George W. Bush signed into law in 2007, allows many not-for-profit and government employees to have their federal student loans canceled after 10 years of payments.

According to Trump’s executive order, borrowers employed by organizations that do work involving “illegal immigration, human smuggling, child trafficking, pervasive damage to public property and disruption of the public order” will “not be eligible for public service loan forgiveness.”

For now, the language in the president’s order was fairly vague. Nor were many details given in the latest announcement about reforming the student loan system, which said the Trump administration is looking for ways to “improve” PSLF.

As a result, it remains unclear exactly which organizations will no longer be considered a qualifying employer under PSLF, experts said.

However, in his first few months in office, Trump’s executive orders have targeted immigrants, transgender and nonbinary people and those who work to increase diversity across the private and public sector. Many nonprofits work in these spaces, providing legal support or doing advocacy and education work.

Changes to PSLF can’t be retroactive, consumer advocates say. That means that if you are currently working for or previously worked for an organization that the Trump administration later excludes from the program, you’ll still get credit for that time, at least up until the changes go into effect.