Social Security unveils cost-of-living adjustment for 2026. Here’s what to know.
Stock image of a social security card alongside US dollars. (Tetra Images/STOCK PHOTO/Getty Images)
(NEW YORK) — Social security benefits will rise 2.8% starting in January, amounting to an additional $56 per month for 75 million recipients, the Social Security Administration (SSA) said on Friday.
The cost-of-living adjustment for 2026, known as COLA, came in slightly higher than the prior year’s hike of 2.5%. Over the past decade, the average COLA clocked in at 3.1%.
The announcement on Friday came after inflation data for September showed a slight acceleration of price increases, sending inflation to its highest level since January. The fresh reading marked the final piece of data necessary for SSA to calculate COLA for 2026.
“Social Security is a promise kept, and the annual cost-of-living adjustment is one way we are working to make sure benefits reflect today’s economic realities and continue to provide a foundation of security,” SSA Commissioner Frank J. Bisignano said in a statement.
The agency will also hike the maximum amount of earnings subject to the Social Security tax, elevating taxable income from $176,100 to $184,500.
SSA will start notifying recipients about their new benefit amount by mail starting in early December, the agency said.
(NEW YORK) — Consumer sentiment soured in October as a government shutdown threatens to weaken a wobbly economy beset by an uptick in inflation and a sharp slowdown of hiring, fresh data on Friday showed. The reading marked a decrease from the previous month but it came in higher than economists expected.
Shopper attitudes have worsened for three consecutive months, resuming a decline that took hold after President Donald Trump took office, University of Michigan Survey data showed.
At its low point this year, consumer sentiment fell close to its worst level since an acute bout of inflation three years ago. The measure remains well below where it stood in December, before Trump took office.
Year-ahead inflation expectations ticked down from 4.7% in September to 4.6% in October, the data showed. The outcome anticipated by respondents would put inflation well above its current level of 2.9%. Long-run inflation expectations held steady from the previous month, data showed.
The data on consumer sentiment is likely to garner more attention than usual, since the government shutdown has halted closely watched releases from the federal government, including monthly jobs and inflation reports.
Consumer spending, which accounts for about two-thirds of U.S. economic activity, is a key bellwether for the outlook of the nation’s economy.
A government shutdown typically risks only modest damage for the economy but it can cause a marked decline in consumer sentiment, threatening a later drop in consumer spending, some experts previously told ABC News.
Consumer sentiment fell more than 7 points from December 2018 to January 2019, coinciding with the most recent 35-day government shutdown, according to a Committee for Responsible Federal Budget analysis of University of Michigan survey data. A souring of consumer sentiment, albeit limited, occurred over each of the three most recent shutdowns that preceded 2018.
The government shutdown, which entered its 10th day on Friday, has shown little sign of resolution. The Senate has rejected dueling funding proposals from Democrats and Republicans in seven separate votes.
The shutdown has coincided with a delicate moment for the nation’s economy, as a hiring slowdown stokes recession fears and inflation proves difficult to fully contain.
Federal Reserve Chair Jerome Powell said last month that policymakers face a “challenging situation” while they attempt to navigate the economy through a “turbulent period.”
(NEW YORK) — The U.S. economy expanded significantly more than initially estimated over a recent three-month period, suggesting robust growth despite uncertainty set off by President Donald Trump’s tariff policy, federal government data on Thursday showed.
The U.S. economy grew at an annualized rate of 3.8% in the second quarter in the government’s final estimate, besting a 3.3% rate issued in its second estimate and far exceeding a 3% initial estimate.
The figure marked a sharp acceleration from an annualized contraction of -0.5% over the first three months of 2025. Still, taken together, the data indicates an economic slowdown over the first half of 2025.
A boost in consumer spending helped propel the economic surge over three months ending in June, the U.S. Commerce Department said. Consumer spending, which accounts for about two-thirds of U.S. economic activity, is a key bellwether for the outlook of the nation’s economy.
To some degree, however, Trump’s levies have blurred the GDP findings.
The government’s GDP formula subtracts imports in an effort to exclude foreign production from the calculation of total goods and services. Changes in the reading on this account reveal neither underlying economic weakness nor strength.
The measure of the GDP fell over the first three months of the year, largely due to a surge of imports as firms stockpiled inventory to avoid far-reaching tariffs. Conversely, a drop-off in imports over the second quarter may have inflated the second-quarter GDP figure.
The GDP growth “primarily reflected a decrease in imports, which are a subtraction in the calculation of GDP,” the U.S. Commerce Department said on Thursday.
The fresh data arrives at a wobbly moment for the nation’s economy.
A jobs report earlier this month showed a sharp decrease in hiring in August, extending a lackluster period for the labor market. Meanwhile, a revision of previous hiring estimates days later revealed the U.S. economy added far fewer jobs in 2024 and early 2025 than previously estimated, deepening concern about the health of the U.S. job market.
The weak jobs data has raised alarm among some analysts who told ABC News the U.S. economy may be slipping toward a recession, though the economy has largely averted the type of widespread job losses that often accompany a downturn.
The Federal Reserve cut interest rates last week in an effort to boost hiring. The Federal Open Market Committee (FOMC), a policymaking body at the Fed, projected two additional quarter-point rate cuts over the remainder of 2025.
Five meetings and nine months had elapsed since the Fed last cut interest rates.
(NEW YORK) — U.S. stocks tumbled in early trading on Friday, just hours after President Donald Trump signed an executive order slapping new tariffs on dozens of countries. A weak jobs report worsened investor jitters, revealing a slowdown of hiring over recent months as Trump’s previous tariffs took hold.
The Dow Jones Industrial Average dropped 615 points, or 1.3%, while the S&P 500 dropped 1.6%. The tech-heavy Nasdaq declined 2.1%.
Trump’s executive order late Thursday laid out rates to be applied against nearly 70 countries, ranging from 10% to 41% in what a Trump administration official hailed as the beginning of a “new system of trade.” The new duties are now set to go into effect on Aug. 7.
The tariff rates resemble reciprocal tariffs that were placed on more than 90 countries on April 2, though there are some differences. Those reciprocal tariffs were delayed 90 days when they set off a major stock selloff and a spike in bond yields.
In early July, Trump delayed the tariffs again, setting a deadline of Aug. 1.
The tariffs announced late Thursday came hours before a jobs report on Friday morning showed a marked cooldown in hiring as Trump’s prior levies filtered through the economy in recent months.
The U.S. added 73,000 jobs in July, which came in well below an average of 130,000 jobs jobs added each month this year, according to data from the U.S. Bureau of Labor Statistics, or BLS.
The report also provided new estimates for two previous months, significantly dropping the government’s estimate of jobs added in May and June. In May, the U.S. added 19,000 jobs, much lower than a previously estimated total of 139,000 jobs, the BLS said. While in June, the economy added just 14,000 jobs, revising downward a previous estimate of 147,000 jobs.
“Today’s jobs report was underwhelming as it missed economists’ expectations, but it’s the stark revisions to the prior two months that really stands out,” Bret Kenwell, U.S. investment analyst at eToro, told ABC News in a statement.
The selloff on Friday appeared to interrupt resilient performance of the stock market going back months. After some market volatility in the spring, investors have largely shrugged off Trump’s tariffs.
The Dow has climbed 2% this year, while the S&P 500 has jumped 6%. The Nasdaq has increased 8%.
Alongside a hotter-than-expected inflation reading on Thursday, the jobs data “may have thrown some cold water on the rally,” Kenwell said.
