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Although inflation is quiet, it’s relentless. Over time, it slowly consumes your retirement savings, reducing the value of what your money can buy. As an example, if annual inflation increases by just 3 percent, something that costs $100 today could cost $180 in 20 years. This is a painful reminder that time can slowly erode your purchasing power.
This isn’t a theoretical concern for retirees and soon-to-be retirees. For 2026, the Social Security Administration has announced a 2.8 percent cost-of-living adjustment (COLA), which means the average retiree receiving $2,008 per month will see their benefit rise to $2,064. While it’s a welcome boost, it’s not enough for most people. An AARP poll found 77 percent of older Americans said the increase still doesn’t keep up with rising prices, a rare point of agreement across generations and political ideologies.
Fortunately, inflation doesn’t threaten your retirement if you aren’t an expert financial planner. With a few smart adjustments, as well as a proactive mindset, you can protect your savings, preserve your lifestyle, and feel confident that your nest egg will stretch as far as you do.
