The $75 estimate

Today's inflation report is not just another economic headline. It supplies the second of three monthly numbers the government uses to calculate your 2027 Social Security raise.

The early estimate already making the rounds is real, but it is not final — and neither is what Medicare will take back out of it. Read the numbers now, and you will know exactly what to watch for before the real announcement in October.

SOCIAL SECURITY

Your 2027 Social Security raise is coming into focus

Every summer, three months of inflation data quietly decide how much bigger your Social Security check will be next January. The first of those three months — July — is already in the books. Today's report supplies the second: August's Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W, the inflation gauge Social Security is required by law to use. One month remains after today before the Social Security Administration can finish the math.

Based on where the numbers stood in July, The Senior Citizens League — a nonpartisan senior advocacy group that publishes a monthly COLA projection — estimates a 3.6% cost-of-living adjustment for 2027. Applied to July's average retired-worker benefit of $2,085.98, that would add roughly $75 a month — and if it holds, it would be the largest percentage raise in four years, ahead of 2.8% in 2026, 2.5% in 2025, and 3.2% in 2024.

My protective read: treat 3.6% as a placeholder, not a promise. This is a private estimate built from a statistical model, not a government count, and the model itself has already moved twice this year — from 2.8% in March up to 3.9% in April, before settling into the mid-3s. The actual number depends on August and September data that has not finished arriving. Do not adjust your budget, your rent, or a big purchase around a figure that can still shift before the Social Security Administration makes it official.

How the number actually gets set

The formula is simple, even when the politics around it are not. Social Security compares the average CPI-W for July, August, and September of this year against the same three months last year. Whatever percentage the index rose becomes next year's raise — no committee vote, no negotiation, just arithmetic written into a 1970s-era law. That is also why an early, partial estimate can move: with a third of the comparison period still outstanding this morning, one volatile month — energy prices, especially — can swing the eventual result by a few tenths of a point in either direction.

Last year's COLA announcement was delayed until October 24 because a government shutdown had furloughed the Bureau of Labor Statistics staff who calculate CPI. Congress avoided a repeat of that this year, funding the government into December, so barring a new surprise, the 2027 number is on track to arrive on its usual mid-October schedule.

Where the raise actually goes

Here is the part that changes every year and gets less attention than it deserves: whatever your raise turns out to be, Medicare takes the first bite before you ever see the money. The standard Part B premium is deducted directly from most people's Social Security checks, and it is rising again in 2027. The 2026 Medicare Trustees Report projects a standard Part B premium of $209.50 next year, up from $202.90 today. Independent forecasters note that this official baseline has undershot the real premium several years running, and some now expect the actual 2027 figure to land closer to $216 to $219 once CMS makes its formal announcement in November.

There is a real protection here, and it is worth knowing by name. The hold harmless provision says your Part B premium increase cannot be larger than your dollar increase in Social Security benefits, as long as you already have Part B premiums withheld from your check and you do not already pay the income-related surcharge. In plain terms: your net Social Security payment cannot go down because Medicare's premium went up. It can, however, absorb nearly the entire raise if the premium jumps enough — which feels very different from what a 3.6% headline implies.

Put rough numbers to it and the squeeze is easier to see. A $75 monthly raise against the government's own $209.50 premium projection would leave the Part B increase eating about $6.60 of it — a modest bite. But if the private forecasters are right and the real 2027 premium lands closer to $216 to $219, the increase alone could run $13 to $16 of that same $75, before any Part D or Medicare Advantage premium change is even counted. The hold harmless provision guarantees you will not go backward. It does not guarantee you will feel the raise.

Who this protection does not cover

Three groups do not get the hold harmless shield, and it is worth checking now whether you are one of them. It does not apply if you are enrolling in Part B for the first time in 2027, since the rule only protects people who already had Part B premiums withheld the prior November and December. It does not apply if you pay the income-related monthly adjustment amount, the IRMAA surcharge charged to higher-income beneficiaries — that surcharge can rise by more than your COLA regardless of the base premium's behavior. And it does not apply if you are dually eligible for Medicaid and a state program already pays your premium, since there is no out-of-pocket increase to hold harmless in the first place. If none of those describes you, the protection applies automatically; there is no form to file.

What to actually do this fall

• Wait for the real numbers, not the early guesses. The Social Security Administration's own October announcement is the only figure worth planning around. Everything published before then, including this issue, is a documented estimate.
• Expect two separate letters. Social Security typically mails your specific 2027 benefit amount in December; Medicare's premium and plan-change notice generally arrives separately, in September or October. Compare the two once both are in hand — a raise on one letter and a premium increase on the other is the math that actually matters, not the headline percentage.
• Use Open Enrollment to control the piece you can control. You cannot change your COLA or the Part B premium, but October 15 through December 7 is when you can change your Medicare drug or Advantage plan, which affects a real slice of your monthly cost.

The headline number will be everywhere by mid-October. The useful question is not how big the raise sounds, but how much of it survives the trip through your mailbox.

MONEY TO CHECK

A $2,000 diesel-emissions payment closes September 30

If you currently own, previously owned, or lease a 2009–2016 Mercedes-Benz or Sprinter BlueTEC diesel vehicle, you may be sitting on an unclaimed $2,000 settlement payment tied to a years-old emissions case, and the claim window closes September 30.

The payment rewards vehicles that received a court-approved Approved Emission Modification, or AEM, a free dealer repair. If the fix was installed at an authorized Mercedes-Benz or Freightliner Sprinter dealer any time from August 1, 2023, through August 31, 2026, you can file a claim now without doing anything further to the car. The window to schedule a brand-new installation has already closed, but a repair completed in that date range still qualifies even if you no longer own the vehicle.

Eligible models include the E-Class, GL-Class, GLE, GLK, ML, R-Class, and S-Class BlueTEC diesels, along with Mercedes-Benz and Freightliner Sprinter vans. You will need your title, bill of sale, or lease agreement, plus the dealer's repair order showing the installation date. File directly through the official settlement site — payment is not automatic.

RETIREMENT ROUNDUP

• Watch for cloned dealership websites: The FTC says scammers are copying real car dealers' websites — logos, listings, even fake reviews — to collect payment for a car that never arrives. Search the dealer's name alongside "scam" or "complaint" before paying anything, insist on seeing the car and the lot in person or through a mobile inspection service, and never wire money upfront. Report a fake dealer at ReportFraud.ftc.gov.
• Check your pantry for recalled moringa powder: Foods Alive recalled 8-ounce packages of organic moringa leaf powder shipped between January 27 and August 7 because of possible Salmonella contamination. The FDA notice identifies the affected date code. Do not eat it; return it to where you bought it for a full refund.

QUICK CHECK

If the 2027 COLA comes in at 3.6%, will every retiree's check go up by the same dollar amount?

ANSWER

No. Social Security applies the percentage to each person's own benefit, so a $3,000 check and a $1,200 check receive different dollar raises under an identical COLA. That is also why the $75 figure in this issue is an average, not a personal number — your December notice will state your own exact amount.

Written by Ellen Marsh

Retirement Shield is educational information only — not financial, tax, or legal advice. We will never ask you for an account number, Social Security number, password, or payment.