Projected 2026 COLA for Social Security: Top 10 States Where Retirees Will See the Largest Increase

Key Insights

• The 2026 cost-of-living adjustment (COLA) for Social Security is set to be announced in October, with current projections suggesting a 2.7% increase in benefits.

• While the percentage increase will be uniform, the actual dollar amount of the raise will vary, with those having higher baseline benefits receiving larger nominal increases.

• New Jersey tops the list of states where retired workers are expected to receive the most substantial COLAs in 2026, due to having the highest median Social Security benefit.

• Many retirees may be missing out on a potential $23,760 Social Security bonus ›

The Social Security system undergoes annual modifications, with the cost-of-living adjustment (COLA) being the most significant for retirees. These yearly COLAs are crucial in maintaining the purchasing power of benefits against inflation, helping beneficiaries cope with rising costs across various sectors of the economy.

The official announcement of the 2026 COLA is scheduled for Oct. 15, following the Labor Department's release of September's inflation data. Current forecasts by The Senior Citizens League estimate a 2.7% increase in benefits for the coming year. However, it's worth noting that this projection has been revised upwards for five consecutive months, indicating potential for further changes.

It's important to understand that while the COLA percentage will be uniform across all Social Security recipients, the actual dollar amount of the increase will differ widely. Let's examine the 10 states where retired-worker beneficiaries are projected to receive the largest COLAs in 2026.

Understanding COLA Calculations

The Social Security Administration determines annual cost-of-living adjustments using the CPI-W, a subset of the Consumer Price Index. The process involves comparing the average CPI-W reading from the third quarter (July to September) of the current year to that of the previous year. The resulting percentage increase becomes the COLA for the following year. For example, a 2.5% increase in the CPI-W during the third quarter of 2024 led to a 2.5% rise in Social Security benefits for 2025.

To calculate the dollar amount of the COLA, the percentage increase is applied to each retired worker's benefit, including any automatically deducted Medicare premiums. The result is then rounded down to the nearest ten cents. For instance, a retired worker receiving $1,500 monthly in 2024 would have seen their benefit grow by 2.5% to $1,537.50 per month in 2025.

Consequently, retired workers with larger Social Security benefits will receive larger COLAs in terms of nominal dollars. Therefore, regardless of the official 2026 COLA percentage, retired workers residing in the 10 states with the highest median Social Security benefits will see the largest monetary increases next year.

Top 10 States for Largest COLAs in 2026

The following table highlights the 10 states with the highest median Social Security benefits for retired workers as of December 2024:

| State | Median Social Security Benefit | |-------|--------------------------------| | New Jersey | $2,172 | | Connecticut | $2,159 | | Delaware | $2,139 | | New Hampshire | $2,121 | | Maryland | $2,084 | | Michigan | $2,067 | | Washington | $2,061 | | Minnesota | $2,053 | | Massachusetts | $2,021 | | Indiana | $2,016 |

It's crucial to note that a retiree's state of residence doesn't directly influence their Social Security income. However, an indirect correlation exists. Since benefits are calculated based on lifetime earnings and claim age, states with higher median incomes tend to have higher median Social Security benefits.

Indeed, five of the listed states -- New Jersey, New Hampshire, Maryland, Washington, and Massachusetts -- are among the top 10 states with the highest median incomes. Additionally, three others -- Delaware, Connecticut, and Minnesota -- boast median incomes above the national average.

Interestingly, Michigan and Indiana, while ranking among the top 10 for median Social Security payouts, have median incomes below the national average. This could suggest that workers in these states tend to claim Social Security at later ages, resulting in larger benefits, or that workers from other states choose to retire in Michigan and Indiana.

To summarize: Social Security benefits are not directly tied to a retired worker's place of residence. Changing states won't automatically increase your benefit. Instead, certain states have higher average incomes, often due to higher living costs, which can lead to larger Social Security checks upon retirement, as benefits are partially based on lifetime earnings.

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