The 2027 Social Security Raise Is Already Shrinking. These 3 ETFs Let You Give Yourself One Instead

The paperwork is still pending, but the math is already clear. The 2026 Social Security COLA came in at 2.8%, and the CPI-W readings that will set the 2027 raise are trending softer, with the index falling to 327.075 in June 2026 from a May peak of 328.829. If that cooling holds into the Q3 measurement window, next year’s raise will be smaller than this one. Meanwhile, your bills continue to go up. The good news: you can hand yourself an income bump the government cannot, using three dividend ETFs built for exactly this job. The three ETFs to do the job are the Schwab U.S. Dividend Equity ETF (NYSEARCA:SCHD), iShares Select Dividend ETF (NASDAQ:DVY), and First Trust Rising Dividend Achievers ETF (NASDAQ:RDVY).

Why Your COLA Keeps Losing to Your Actual Living Costs

The COLA is a backwards-looking number. It reflects inflation the Social Security Administration measured months ago, not the prices you are paying today. Headline CPI has climbed from 323.291 in August 2025 to 332.568 in June 2026, and disinflation in the CPI-W simply means next year’s raise arrives smaller while your fixed costs keep drifting higher. That gap is where a dividend portfolio becomes increasingly important. Instead of waiting on Washington, you set your own raise schedule with cash that lands in your account every quarter.

SCHD: The Low-Cost Core of Your Homemade Raise

SCHD tracks the Dow Jones U.S. Dividend 100 Index and screens for companies with a decade of dividend history and healthy balance sheets. With roughly 0.06% in annual fees, you keep about $994 of every $1,000 working for you, which matters when you are living off distributions. The fund pays quarterly and delivered $1.048 per share over the trailing 12 months, roughly a 3.1% yield at the August 5 price of $33.64. Top holdings read like a retiree’s shopping list of cash generators: QUALCOMM at 6.74%, Texas Instruments at 5.90%, UnitedHealth at 5.09%, Coca-Cola at 3.96%, and Chevron at 3.83%. With $94.9 billion in assets and a 30.36% one-year total return, SCHD is the anchor most retirees should own first.

DVY: The Higher-Yield Defensive Sleeve

If SCHD is the portfolio’s anchor, DVY complements it with a higher dividend yield. It tracks the Dow Jones U.S. Select Dividend Index and leans hard into utilities, regional banks, tobacco, and insurance; sectors that write dividend checks in almost any market conditions. Fees run higher at roughly 0.38%, but the income is real: $5.26 per share in trailing 12-month distributions, working out to about 3.25% at the current $161.67 share price. Big positions include Altria at 2.29%, Pfizer at 2.22%, T. Rowe Price at 2.02%, and Verizon at 1.85%. The utilities bench alone stretches from Dominion and Edison International to Exelon, Duke-adjacent Alliant, and NextEra. With $22.9 billion in assets and a 23.39% one-year total return, DVY provides a defensive tilt while continuing to deliver competitive returns.

RDVY: The Raise That Grows With You

A fixed dividend still loses to inflation over time. RDVY answers that problem by owning companies that consistently increase their payouts. The fund tracks the NASDAQ US Rising Dividend Achievers Index, blending mature dividend growers with faster-growing names most income funds skip. Fees are steeper at roughly 0.48%, and the current yield is thinner near 0.8% on $0.677 in trailing 12-month payments and an $83.34 share price. However, the trade-off is where things get interesting. Top positions include Lam Research at 3.35%, Applied Materials at 3.14%, KLA at 2.80%, and GE Vernova at 2.75%, with roughly 17% of the portfolio in semis and tech. That is why RDVY posted a 32.51% one-year total return and 352.4% over ten years. Think of it as the raise that compounds.

The Trade-Off

These funds carry real risk. Dividends can be cut, share prices can fall, and a rough year for banks or utilities will hurt DVY the same way a semiconductor pullback will bruise RDVY. RDVY’s own payout has bounced between $0.1474 and $0.3756 across recent quarters, so treat it as a growth kicker, not a monthly bill-payer. That said, blend the three, and you get what a shrinking COLA cannot deliver: a low-cost quality core in SCHD, a defensive high-yield sleeve in DVY, and a dividend-growth engine in RDVY that fights inflation on its own terms. That is a raise you give yourself, on your schedule, no matter what October’s announcement says.

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