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☕ DrinkCoffeeAndProfit
Smart money moves before breakfast
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Inspiration Quote for the Day
“Social Security is not a handout. It is an earned benefit.”
— Elizabeth Dole
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The Morning Ritual
Your Social Security Raise Next Year Is Already Shrinking. Congress Is Quietly Talking About Cutting More.
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Every January, Social Security checks get a cost-of-living adjustment. Last year it was `3.2%`. This year the early estimate for 2027 just came in closer to `2.2%`. That sounds like a small difference. It is not. On the average retirement check of `$1,907` a month, that is the difference between a `$61` raise and a `$42` raise. Nineteen dollars a month you were counting on that quietly disappeared.
Meanwhile, AARP just sent a public letter to Congress saying they “strongly object to fast-tracking Social Security changes.” A bipartisan group of senators is already building a reform framework. Nobody on television is leading with this story. But the people in Washington who write the rules are already moving.
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In One Sip
► The 2027 COLA estimate has dropped to roughly `2.2%` as inflation cools. Last year’s was `3.2%`. The year before that was `8.7%`. The raises are shrinking while the bills are not.
► The average Social Security retirement check is `$1,907` a month. A `2.2%` COLA adds `$42`. After Medicare Part B premiums take their cut, the actual increase in your deposit could be closer to `$15` to `$20`.
► AARP publicly told Congress it “strongly objects” to fast-tracking Social Security changes through the reconciliation process. That means somebody in Washington already proposed it. You do not object to something nobody suggested.
► S&P 500 futures are slightly higher Tuesday morning. The 10-year yield sits near `4.38%`. VIX at `19`. All eyes are on tomorrow’s CPI report at 8:30 AM. That number decides the next move on rates, and rates decide whether your savings keep pace with the COLA the government is not giving you.
► The Social Security trust fund is projected to run short around `2034`. After that, benefits drop to roughly `77%` of the promised amount unless Congress acts. That is eight years away. Congress has not acted.
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Why It Matters for Your Money
Here is the math most people never do. If your Social Security check is `$1,907` and the COLA is `2.2%` instead of `3.2%`, you lose `$19` a month. That is `$228` a year. Over a twenty-year retirement that is `$4,560` in lost purchasing power from one year’s adjustment alone. Now multiply that by every year the COLA undershoots real inflation in your life — groceries, insurance, prescriptions — and you start to see the gap.
The people who depend entirely on Social Security — and that is roughly `40%` of American retirees — absorb every one of these cuts directly. There is no second income to cushion it. There is no employer match to offset it. There is just a smaller number on a government deposit and a larger number on every bill.
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The Wealth Angle
The COLA formula is based on the Consumer Price Index for Urban Wage Earners, not for retirees. Retirees spend more on healthcare, housing, and insurance — all of which are rising faster than the headline number. The government measures your raise with someone else’s shopping cart.
That is why financial planners keep saying the same thing: Social Security was designed to replace about `40%` of your working income. If it is replacing `90%` or `100%`, every COLA cut lands like a pay cut. The people who built a second leg — a brokerage account, rental income, a pension, even a part-time consulting gig — barely notice the difference. The people who did not feel every dollar of it.
The window to build that second leg does not stay open forever. It closes the day you stop earning. And for most people, that day is closer than they think.
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· · · Partner Message · · ·
The number you’ve been working toward just moved.
In 2020, the retirement target for the middle class was around $600,000.
Today it’s closer to $1.5–2 million.
Same life. Same rules. Different outcome.
That’s not inflation. That’s a structural shift in what “enough” even means.
When your target doubles, effort stops acting like progress. It becomes maintenance.
Most people respond by trying harder. Saving more. Working longer.
But what’s really driving this doesn’t respond to effort.
Most people never stop to ask what’s actually happening to their money or about what’s being created on the other side.
They adjust. They accept. They keep running with the wrong math.
See What Broke the Retirement Math — and What It Means for Your Future
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☕ Key Insight:
Social Security was never meant to be your entire retirement. It was meant to be one leg of a three-legged stool. The problem is that for forty percent of American retirees, it is the only leg. And that leg just got a little shorter.
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Coffee Break Move
Step 1: Log in to ssa.gov/myaccount and check your projected benefit. Most people have not looked at this number in years. It takes two minutes.
Step 2: Calculate what a `2.2%` raise means on your projected check. Then subtract the likely Medicare Part B increase. The number left over is your actual raise. Write it down.
Step 3: Ask yourself one question: if Congress cuts benefits by `23%` in 2034 and my COLA barely covers inflation between now and then, what is my plan? If you do not have an answer, this is the week to start building one. Not next year. Not when it makes the news. Now.
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