In January 2026, over 70 million Social Security beneficiaries stood to have their monthly payments increase by 2.8 percent, that year’s so-called cost-of-living adjustment. Scammers literally bank on these recipients being confused by the annual increase and aim to capitalize on that uncertainty, often by referencing real COLA details to sound legitimate. But here’s the crucial point for you and your loved ones: The increase happens automatically. Anyone who contacts you claiming you need to take action to “enable,” “verify,” or “activate” the adjustment is a fraudster.
Each fall, the Social Security Administration (SSA) announces how much more money beneficiaries—people who receive monthly Social Security payments, including retirees, people with disabilities, and eligible family members such as spouses, widows, widowers, and dependent children—will get each month to account for the nearly inevitable rise in the cost of living. That increase is called the “cost of living adjustment” (COLA).
Unfortunately, changes like this tend to draw the attention of scammers. It’s not hard to see why: COLA creates a large pool of potential targets who are navigating complex and sometimes confusing government benefits. And because the Social Security system is so large, fraudsters often assume their schemes can slip through the cracks. Add in the fact that COLA involves something scammers always want: money.
Lucky for anyone receiving Social Security benefits, it’s simple to stay safe when it comes to COLA scams.
What is the Social Security cost-of-living adjustment (COLA)?
Almost every year, the prices of goods (like groceries) and services (like childcare) increase. That increase is called “inflation.”
When a person works, a portion of their earnings tax gets earmarked for the SSA. When that person nears or reaches retirement, they can get the money they paid into the SSA paid back out to them.
But since a dollar today doesn’t stretch as far as a dollar yesterday, SSA aims to bridge the gap by giving beneficiary recipients an adjusted amount that accounts for the increase in the cost of living.
The goal is to provide every senior person (especially lower-income retirees who might not have had enough disposable income to save) a financial safety net. Survivors of deceased persons who would have received these benefits and qualifying disabled people also receive SSA payments.
How the COLA amount is calculated and distributed
The U.S. Bureau of Labor and Statistics monitors the cost of food and beverages, housing, clothing, transportation, medical care, education, communication, and more to determine the Consumer Price Index (CPI). The cost-tracking data is then used to determine the percentage of inflation needed to cover the increase in cost of living.
COLA payments occur automatically. If you have set up an online “my Social Security account” through the SSA and you’ve enabled direct deposit, your annual increase will appear in your bank account along with the rest of the monthly payment.
If you typically receive mailed monthly paper checks from the SSA, your COLA will be added to those.
COLA payments in 2026
Here’s a simple example to make that alphabet soup a bit easier to digest: The COLA for 2026 is 2.8 percent. If someone received $1,000 per month in Social Security benefits in 2025, they would multiply that amount by 0.028, which comes out to $28. That means their monthly benefit in 2026 would increase to $1,028.
How to recognize a COLA scam
One way to sniff out a scammer is by knowing what the SSA and its employees will never do. While the SSA does communicate via printed mail, email, and telephone, it and its workers will never do the following:
Request that you call them back in response to a text or email
Promise your COLA increase only in exchange for a preliminary payment
Threaten imprisonment or legal action unless you pay a fee
Demand payment using gift cards, cash, cryptocurrency, pre-paid debit cards, or wire transfers
Ask for your personally identifiable information (PII) or financial details, such as bank routing numbers
Today’s scammers may also use more sophisticated tactics, such as spoofed phone numbers or emails that appear to come from the SSA, phishing links that mimic the “my Social Security” login page, or automated robocalls that reference the exact COLA percentage to sound legitimate.
If someone contacts you and does any of these things, immediately be suspicious. Even if no money changes hands, sharing personal information can lead to identity theft, benefit diversion, or long-term financial harm.
How to handle a COLA scam
If you suspect a COLA scammer has contacted you, disengage immediately and block them. Don’t click on any links they may have sent, and don’t reply to “verify” or “confirm” information, even if the message appears urgent or official.
Take screengrabs of any digital communication between you and the scammer, delete any such messages, and report the incident to the SSA’s Office of the Inspector General. You can also do the same in person at the closest SSA office in your area.
Because COLA adjustments occur annually, these scams tend to resurface year after year, often with new tactics. Staying informed is one of the most effective ways to protect yourself and your loved ones.
