What is the projected 2026 federal employee COLA percentage and how is it calculated?

1. What the announced 2026 numbers mean for beneficiaries

Social Security and CSRS beneficiaries will see a 2.8% increase in benefits beginning with December-payable-in-January 2026 checks, which the SSA says equals about $56 a month on average for beneficiaries; nearly 71 million Social Security recipients are covered ^{[4] [3]}. FERS annuitants will get only a 2.0% increase in their FERS basic annuity because current law caps the FERS COLA at 2% when the CPI‑W rises between 2% and 3% ^{[5] [6]}.

2. How the SSA actually calculates the COLA

The statutory mechanism uses the CPI‑W: SSA averages the index values for July, August and September of the current year and compares that average to the July–September average for the prior year in which a COLA was in effect ; the percentage increase becomes the COLA—2.8% for 2026 ^{[1] [3]}. Multiple outlets explain the same mechanics: the 2026 COLA was based on the CPI‑W third‑quarter comparison and finalized by the SSA’s October announcement ^{[1] [7]}.

3. Why FERS gets a different, smaller adjustment

FERS COLAs are governed by a different statutory rule: if the CPI‑W increase is less than 2% FERS gets the full COLA; if it is between 2% and 3%, FERS annuitants receive a 2% cap; and if CPI‑W rises 3% or more, FERS COLA equals the CPI‑W increase minus 1 percentage point. Because the 2026 CPI‑W increase fell between 2% and 3%, FERS annuitants are capped at 2.0% for 2026 ^{[5] [8]}.

4. The arithmetic beneficiaries will use to estimate their new checks

SSA and reporting outlets advise beneficiaries to multiply their current monthly benefit by 1.028 to estimate the 2026 amount (Social Security/CSRS) or by 1.02 for the FERS basic annuity portion—keeping in mind Medicare Part B or other deductions can reduce the net increase received in a check ^{[7] [9]}. Reporting also notes Medicare premiums are likely to rise in 2026 and will be deducted from Social Security checks, muting the practical effect of the COLA for many beneficiaries ^{[9] [10]}.

5. Context, politics and competing viewpoints

Some advocates and unions argue the CPI‑W measure and the FERS cap understate retirees’ cost pressures: groups including NARFE and other unions criticized a 2.8% COLA as insufficient against rising health‑insurance premiums and higher out‑of‑pocket costs ^{[2] [11]}. Conversely, economists and policy analysts emphasize that the COLA follows long‑standing statutory rules tied to CPI‑W and that proposals to shift to other measures (for example CPI‑E, a seniors’ price index) have supporters and opponents in Congress and beyond ^[9].

6. Limitations in available reporting and what’s not shown

Available sources describe the CPI‑W third‑quarter comparison, the 2.8% SSA figure, and the FERS cap rule, but they do not provide a step‑by‑step disclosure of the raw monthly CPI‑W series used in the SSA’s internal rounding and announcement process; detailed SSA worksheets and exact month‑by‑month CPI‑W values are not reproduced in the articles provided (not found in current reporting). Also, while media note Medicare premium impacts, the precise net cash‑in‑hand for any particular beneficiary depends on individual deductions and is not provided here ^[10].

7. What to watch next

Watch for SSA’s mailed and my Social Security notices in late November and the first benefit statements reflecting the increase in December/January; advocacy groups are likely to push further legislative proposals (for example to use CPI‑E or to change FERS indexing) and will cite the 2026 outcome in arguing reform is needed ^{[4] [9]}. Congressional proposals to alter the COLA measure or FERS rules are discussed in news coverage but remain proposals—not law—in the sources provided ^[9].

Sources: SSA fact sheet and related reporting on the 2026 COLA ^{[1] [4] [3]}, press and union reporting on CSRS/FERS differences and reactions ^{[2] [5] [6]}, and analysis of Medicare‑premium offset and calculation mechanics ^{[9] [10]}.