COLA increase might be just 2.4%—the lowest in years. Here’s how shrinking Social Security raises housing risks for retirees.

Despite nominal increases in Social Security benefits, retirees in the U.S. have experienced a substantial decline in purchasing power, ranging from 20% to 36% over the past two decades.

For the first time in the 90-year history of Social Security, the average monthly benefit for retired workers is projected to go beyond $2,000 next month. Despite the historic nature of this milestone,

Higher inflation in the third quarter would indeed result in a higher COLA for 2026, which in turn would give Social Security recipients larger benefits for next year. But the extra money would go toward paying for a rising cost of living, and there's no guarantee the COLA will be enough to completely offset inflation's effect on buying power.

New government data shows the pace of inflation has subsided from pandemic-era highs. Social Security beneficiaries may see a smaller benefit boost. This article originally appeared here and was republished with permission.

There are a myriad of reasons why retirees look to build long-term portfolios that can sustain their spending goals in retirement. For one, social security benefits aren’t generally considered to be enough to cover most Americans’ spending needs in retirement.