Social Security's Shift to a New Inflation Measure Will Lift Retiree Payouts

In December 2027, Social Security will switch how it adjusts benefits for inflation. It will use CPI-E instead of CPI-W—a measure that weights healthcare and housing more heavily, since retirees spend more on these. Historically, CPI-E rises faster by roughly 0.2 to 0.3 percentage points yearly. Over a 28-year retirement, that gap compounds into meaningfully higher lifetime benefits.