Are rising tariffs putting Social Security COLA at risk? Seniors are growing concerned
- Replies 2
You know the annual cost-of-living adjustment (COLA) announcement is a big deal and sometimes the difference between making ends meet and having to pinch a few more pennies.
The adjustment is meant to help monthly checks keep pace with inflation, but many are worried that this year’s number won’t stretch far enough.
With new tariffs driving up the price of everyday essentials, retirees say they feel squeezed from every direction.
And even though COLA is designed to protect benefits, there’s often a lag—leaving many wondering if their income will keep up with real-world costs.
Each fall, the Social Security Administration (SSA) looks at inflation data from July, August, and September to determine how much your check will increase the following year.
For 2026, the latest projection from The Senior Citizens League pegs the COLA at 2.7%—a slight bump from this year’s 2.5%, which translated to about $50 more per month for the average retiree.
But the catch is inflation isn’t just a number on a government spreadsheet. It’s what you feel at the grocery store, the pharmacy, and when you pay your electric bill.
And lately, those numbers have been climbing faster than the official inflation rate, especially for essentials like shelter, electricity, and medical care.
The current administration’s sweeping tariffs—some as high as 50% on goods from countries like India—are intended to protect American industries.
But they also make imported goods more expensive, which can ripple through the economy and push prices higher across the board.
A recent survey by the Nationwide Retirement Institute found that half of retirees are “terrified” about the impact of tariffs on their retirement income or savings.
More than 60% believe rising tariffs will drive inflation beyond what the COLA can cover. That’s not just worry—it’s reality for many.
The survey also revealed that a third of retirees are cutting back on essentials like groceries and medical care, not just the occasional dinner out or new pair of shoes.
Tina Ambrozy, head of strategic customer solutions at Nationwide, summed it up: “Seniors tell us they feel squeezed from all sides, and the uncertainty around tariffs and rising inflation is adding a new layer of financial stress.”
Here’s where things get tricky. The COLA is based on the Consumer Price Index (CPI) for Urban Wage Earners and Clerical Workers (CPI-W), which may not fully reflect the spending patterns of seniors—especially when it comes to healthcare and housing.
And if tariffs push up prices after the third quarter, those increases might not show up in your benefit until the following year.
Economists are watching closely. Federal Reserve Chair Jerome Powell recently acknowledged that tariffs are driving inflation, and some experts warn that the calm we’ve seen in inflation numbers may not last.
Seema Shah, chief global strategist at Principal Asset Management, cautioned that late summer and autumn inflation reports could reveal more price acceleration, adding to concerns about the outlook.
There’s another wrinkle: the accuracy of the inflation data itself. Recent staff changes and budget cuts at the Bureau of Labor Statistics (BLS) have raised questions about whether the government can still collect reliable data.
As Kathleen Romig, director of Social Security and disability policy at the Center on Budget and Policy Priorities, put it, “We don’t know what the heck is going on over at the BLS anymore since Trump removed the BLS director.”
Fewer staff means fewer visits to stores to check prices, which could skew the numbers up or down.
And let’s not forget the political angle. “Obviously, the administration has a political incentive to downplay inflation,” Romig said.
“Inflation is a very politically salient issue that people get pretty fired up about. That is what is making people pretty nervous.”
Also read: Big Social Security changes are coming in 2026—here’s what to know now
The bottom line: Social Security checks are inflation-protected, but there’s always a lag. If tariffs or other factors push prices higher after the COLA is set, you might feel the pinch for a while before your benefits catch up.
And with the average retiree’s monthly benefit hovering around $2,000, even a modest increase in costs can be overwhelming—especially when more than half of recipients say their benefits don’t cover their basic needs.
Many retirees are already dipping into savings or retirement accounts to make ends meet, and nearly 1 in 5 say it’s become harder to access or manage their benefits this year.
Food costs, in particular, are likely to keep rising due to a mix of tariffs, weather events, and labor shortages.
Read next: Are you ready for this massive Social Security shake-up? Here’s what you must do before September 30
Are you feeling the impact of tariffs and inflation on your retirement? Have you had to make tough choices about spending or saving? Do you have tips for stretching your Social Security check a little further?
The adjustment is meant to help monthly checks keep pace with inflation, but many are worried that this year’s number won’t stretch far enough.
With new tariffs driving up the price of everyday essentials, retirees say they feel squeezed from every direction.
And even though COLA is designed to protect benefits, there’s often a lag—leaving many wondering if their income will keep up with real-world costs.
Each fall, the Social Security Administration (SSA) looks at inflation data from July, August, and September to determine how much your check will increase the following year.
For 2026, the latest projection from The Senior Citizens League pegs the COLA at 2.7%—a slight bump from this year’s 2.5%, which translated to about $50 more per month for the average retiree.
But the catch is inflation isn’t just a number on a government spreadsheet. It’s what you feel at the grocery store, the pharmacy, and when you pay your electric bill.
And lately, those numbers have been climbing faster than the official inflation rate, especially for essentials like shelter, electricity, and medical care.
The current administration’s sweeping tariffs—some as high as 50% on goods from countries like India—are intended to protect American industries.
But they also make imported goods more expensive, which can ripple through the economy and push prices higher across the board.
A recent survey by the Nationwide Retirement Institute found that half of retirees are “terrified” about the impact of tariffs on their retirement income or savings.
More than 60% believe rising tariffs will drive inflation beyond what the COLA can cover. That’s not just worry—it’s reality for many.
The survey also revealed that a third of retirees are cutting back on essentials like groceries and medical care, not just the occasional dinner out or new pair of shoes.
Tina Ambrozy, head of strategic customer solutions at Nationwide, summed it up: “Seniors tell us they feel squeezed from all sides, and the uncertainty around tariffs and rising inflation is adding a new layer of financial stress.”
Here’s where things get tricky. The COLA is based on the Consumer Price Index (CPI) for Urban Wage Earners and Clerical Workers (CPI-W), which may not fully reflect the spending patterns of seniors—especially when it comes to healthcare and housing.
And if tariffs push up prices after the third quarter, those increases might not show up in your benefit until the following year.
Economists are watching closely. Federal Reserve Chair Jerome Powell recently acknowledged that tariffs are driving inflation, and some experts warn that the calm we’ve seen in inflation numbers may not last.
Seema Shah, chief global strategist at Principal Asset Management, cautioned that late summer and autumn inflation reports could reveal more price acceleration, adding to concerns about the outlook.
There’s another wrinkle: the accuracy of the inflation data itself. Recent staff changes and budget cuts at the Bureau of Labor Statistics (BLS) have raised questions about whether the government can still collect reliable data.
As Kathleen Romig, director of Social Security and disability policy at the Center on Budget and Policy Priorities, put it, “We don’t know what the heck is going on over at the BLS anymore since Trump removed the BLS director.”
Fewer staff means fewer visits to stores to check prices, which could skew the numbers up or down.
And let’s not forget the political angle. “Obviously, the administration has a political incentive to downplay inflation,” Romig said.
“Inflation is a very politically salient issue that people get pretty fired up about. That is what is making people pretty nervous.”
Also read: Big Social Security changes are coming in 2026—here’s what to know now
The bottom line: Social Security checks are inflation-protected, but there’s always a lag. If tariffs or other factors push prices higher after the COLA is set, you might feel the pinch for a while before your benefits catch up.
And with the average retiree’s monthly benefit hovering around $2,000, even a modest increase in costs can be overwhelming—especially when more than half of recipients say their benefits don’t cover their basic needs.
Many retirees are already dipping into savings or retirement accounts to make ends meet, and nearly 1 in 5 say it’s become harder to access or manage their benefits this year.
Food costs, in particular, are likely to keep rising due to a mix of tariffs, weather events, and labor shortages.
Read next: Are you ready for this massive Social Security shake-up? Here’s what you must do before September 30
