Some spending categories may be impacted by COLA

Summary

• The cost-of-living adjustment (COLA) for Social Security recipients is 3.6%, marking the largest increase in four years.
• Older households relying on Social Security may see spending growth next year, potentially narrowing the gap with other age cohorts.
• Spending growth for older generations currently lags most in discretionary categories including electronics, lodging, & restaurants.
• Data from Bank of America internal sources shows year-over-year spending growth differences between older generations & overall households across various categories.
• The methodology uses aggregated & anonymized transaction data from US Retail, Preferred, Small Business, & Wealth Management clients.
• Household income terciles are determined by quantitative estimates & periodically re-assessed based on factors like wage inflation & Social Security payments.
• Generational definitions include Baby Boomers (born 1946-1964) & Traditionalists (born pre-1946).
• Discretionary retail categories include furniture, electronics, building materials, clothing, & miscellaneous stores.
• Necessity spending categories include groceries, utilities, & gasoline.
• The report was published on 02 November 2026 by the Bank of America Institute.