Social Security benefits are getting their biggest boost since 2023. But there's a catch.

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Social Security and SSI benefits will increase by 3.6% in 2027 for more than 72 million people, the Social Security Administration (SSA) announced Wednesday. The cost-of-living adjustment (COLA) is the biggest since 2023 and means, on average, retirement benefits will rise by $75 a month, SSA said. The Committee for a Responsible Federal Budget (CRFB) says that works out to roughly $900 a year, and estimates the highest earners will see an increase of more than $2,200 a year. SSA calculates the COLA based on the average year-over-year change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (a form of measuring inflation) for July, August and September.  SSI recipients will see the first higher payment on Dec. 31, 2026. Some people receive both SSI and Social Security. Most Social Security recipients will be paid the higher amount starting Jan. 1, 2027. The COLA will also affect Medicare Part B beneficiaries, whose premiums are deducted from their Social Security payments. The 2027 standard premium is projected to rise to $209.50 from $202.90, an increase of $6.60 a month, which would leave the average retired worker about $68 a month better off after COLA. 'Next year's COLA can't come soon enough' SSA Commissioner Frank J. Bisignano said the adjustment will give beneficiaries "greater financial stability," and reflects a year of elevated inflation, particularly in gasoline and energy prices.  But Nancy Altman, president of the advocacy group Social Security Works, said the increase "doesn't fully account for the costs that Social Security beneficiaries face." Altman said that's because the CPI-W, the inflation index used to calculate Social Security increases, tracks the costs of working people, not retirees, who she said spend a higher share of their income on health care and housing. "Next year's COLA can't come soon enough for many Social Security beneficiaries," she told Yahoo. The Senior Citizens League (TSCL), a nonpartisan seniors' group, was also critical of the payment increase. Executive director Shannon Benton said in a statement that the COLA "falls short of expectations" and that benefits lag behind price spikes because seniors don't see the adjustment until January. It's a concern also shared by beneficiaries. AARP analysis released this week found that 76% of adults 50 and older said a COLA of around 3.5%, slightly lower than the announced figure, would not be enough to help them keep up with rising prices.  Kathleen Romig, director of Social Security and disability policy at the Center on Budget and Policy Priorities, said the annual COLA increase is "especially important in times of high inflation." "This year's COLA is bigger than in many recent years because of rising prices," she told Yahoo. "Another 3.6% … will help beneficiaries keep up with rising costs at the pump and in the grocery store." "Gas and groceries can eat (COLA) up quickly, and that's before you factor in healthcare, where costs are projected to grow by an average of 5.4% a year over the next decade," Robert Laura, a retirement transition coach told Yahoo. Some policy groups say the COLA calculation should be updated to use a measure that better reflects retirees' spending habits. The Senior Citizens League wants COLA for retirees to be calculated based on a metric called the Consumer Price Index for the Elderly (CPI-E) . Introduced by the U.S. Bureau of Labor Statistics (BLS) in 1987, it uses the same underlying price collection system as the main CPI, but instead calculates the market basket to reflect how older Americans actually spend their money , taking a snapshot of retirees' spending priorities as well as how much they spend out of pocket. How do I check if I'm eligible for the increase? You don't need to do anything. The increase is automatic for everyone receiving Social Security or SSI. SSA said enrollees can see their 2027 Medicare Part B premium in their "my Social Security Message Center" starting in late November. Medicare changes will be posted at medicare.gov. Beneficiaries will receive a simplified, one-page COLA notice with their new benefit amount, exact dates and any deductions. Online: People with a personal my Social Security account can view the notice starting in late November, up to three weeks before a mailed notice. People without an account need to create one and enroll in paperless notices by Nov. 18 to see it online. Account holders can also sign up for text or email alerts. By mail: Anyone not enrolled in paperless notices will get theirs in December. For more information, see SSA's COLA page . Key dates Nov. 18: Deadline to create a my Social Security account and enroll in paperless notices to see the notice online. Late November: Online COLA notices will become available to paperless account holders, and Medicare enrollees can see their 2027 Part B premium in their Message Center. The premium is typically deducted directly from monthly Social Security payments. December: Mailed COLA notices go out. Dec. 31, 2026 to January 2027: Beneficiaries begin receiving payments with the increase added. SSI payments normally arrive on the first of the month, but the January payment will arrive on Dec. 31, 2026, because Jan. 1 is a federal holiday. Social Security payments generally go out on the second, third or fourth Wednesday of the month, based on the beneficiary's birthday. People who began receiving Social Security before May 1997, or who receive both Social Security and SSI, generally get their Social Security payment on the third of the month. This article originally appeared on Yahoo News at https://www.yahoo.com/news/us/article/social-securitys-2027-cola-is-the-biggest-since-2023-how-it-affects-your-payments-102549636.html