Washington, D.C., October 25, 2025 – The Social Security Administration (SSA) has announced a 2.8 percent cost-of-living adjustment (COLA) for benefits in 2026, providing a modest boost to millions of Americans amid ongoing economic pressures. This increase, effective starting January 2026 for Social Security beneficiaries and December 31, 2025, for Supplemental Security Income (SSI) recipients, aims to help benefits keep pace with inflation as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
Nearly 71 million Social Security beneficiaries, including retirees, disabled workers, and survivors, will see their monthly checks rise by an average of $56, bringing the typical retired worker’s benefit to approximately $2,071. For married couples both receiving benefits, the average monthly increase will be about $88, resulting in an average payment of $3,208. Additionally, nearly 7.5 million SSI recipients will receive adjusted payments, though specific maximum federal benefit rates were not detailed in the announcement.
The COLA is calculated based on the year-over-year change in the CPI-W for the third quarter, specifically (317.265 – 308.729) / 308.729 × 100 = 2.8 percent. This marks a slight uptick from the 2.5 percent adjustment in 2025 but falls short of the 8.7 percent increase seen in 2023 during a period of higher inflation. SSA Commissioner Frank Bisignano emphasized that the adjustment “ensures benefits reflect economic realities and provide a foundation of security” for recipients, many of whom—about 40 percent of older Americans—rely on Social Security as their primary income source.
Other Key Changes for 2026
In addition to the COLA, several other updates will take effect next year:
- Maximum Taxable Earnings: The wage base for Social Security payroll taxes will rise to $184,500, up from $176,100 in 2025. This means higher earners will pay Social Security taxes on an additional $8,400 of income, with the employee and employer each contributing 6.2 percent (totaling 12.4 percent).
- Retirement Earnings Test (RET) Limits: For working beneficiaries under full retirement age (FRA) throughout the year, benefits will be reduced by $1 for every $2 earned above $24,480. In the year a beneficiary reaches FRA, the threshold increases to $65,160, with a $1 reduction for every $3 earned over that amount.
- Quarters of Coverage: To earn one Social Security credit, workers will need $1,890 in earnings, up from $1,810 in 2025. Four credits (the maximum per year) will require $7,560. Individuals typically need 40 credits to qualify for retirement benefits.
- Medicare Part B Premiums: While not directly part of Social Security, many beneficiaries will see their net COLA gains offset by rising healthcare costs. The standard monthly Medicare Part B premium is projected to increase by 11.6 percent, or $21.50, to $206.50. Higher-income individuals may face additional surcharges.
Beneficiaries can expect to receive notices of their updated benefit amounts by mail in early December or access them sooner via a My Social Security online account. Payment dates for Social Security in January 2026 will depend on birth dates: the 14th for those born 1st–10th, the 21st for 11th–20th, and the 28th for 21st–31st.
This announcement comes as Social Security faces long-term funding challenges, with trust fund reserves projected to be depleted by the mid-2030s without legislative action. For now, however, the 2.8 percent boost offers some relief to those depending on the program in an era of persistent inflationary pressures.
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