What History's Highest Social Security COLAs Can Tell You Today

Before 1975, there was no uniform COLA. Rather, Congress doled out Social Security benefit boosts at its discretion.

COLAs are little more than an indicator of the recent rate of inflation.

Current predictions indicate that Social Security recipients are likely to receive a cost-of-living adjustment (COLA) of about 3.9% in 2027, thanks primarily to the high cost of living and inflation that doesn't seem to want to budge. And while 3.9% seems relatively high, it's nothing compared to some COLAs of the past.

Here, I'm taking a look at the history of COLAs , specifically at years when the benefit bump was truly high.

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Before 1975, Social Security benefit increases were not automatic. Instead, Congress had to pass specific legislation to raise benefits, and these raises were irregular. In addition, they typically lagged behind inflation. Because of this, Social Security recipients could go years without an increase and then receive a large, politically timed Social Security COLA boost.

In 1975, a new law required benefits to rise with a measured increase in consumer prices, and because the CPI-W index indicated inflation of roughly 8%, benefit recipients received an 8% increase.

In the late 1970s, the U.S. experienced stagflation, with high inflation, stagnant or weak economic growth, and high unemployment occurring simultaneously. There was also a major energy crisis during the 1979 Iranian Revolution, with consumer prices rising at double-digit rates. This "perfect storm" of conditions led to the largest COLA increase on record, at 14.3%.