How is the Social Security COLA calculated?
The Social Security Administration calculates the Cost-of-living adjustment (COLA) applied to benefits each year by comparing the Consumer Price Index for Urban Wage Earners and Clerical Workers from quarter 3 (July, August, September) from the current year to the previous.
The CPI-W data for July and August is available and the current average sits at 291. The average for Q3 last year was 268.421. This means that if the COLA was determined by the numbers from July and August, seniors would see an 8.4 percent boost in their payment amounts. However, if price increases in September were not as large as those seen earlier this summer, this number could shrink.