Starting in January, the Cost-of-Living Adjustment (COLA) will increase Social Security checks for millions of Americans. But for one particular group—those who contributed the maximum legal amount throughout their working lives. The change brings concrete figures that redefine the path for those who are thinking about claiming Social Security benefits in 2026.
The Social Security Administration (SSA) has confirmed that the maximum benefit for a worker retiring at full age will reach $4,152 per month in 2026, an increase of $134 from the previous year thanks to the 2.8% COLA.
However, that figure is only the starting point of a more complex equation, where the age chosen to begin receiving benefits acts as a dramatic multiplier or divisor. As the system prepares for this adjustment, beneficiaries face a strategic crossroads with lifelong implications.
The Age to Claim Social Security: Permanent Reductions and Bonuses
The concept of “full retirement age” (FRA) is the centerpiece of your planing. For those born in 1960 or later, the FRA is 67. Claiming the benefit at that age grants 100% of the calculated benefit. Any deviation from that point results in a significant and permanent actuarial adjustment.
Choosing to retire early at age 62, the minimum age allowed, carries the most severe penalty. For someone with a FRA at age 67, claiming at 62 results in a permanent reduction of approximately 30%. Translated to the new 2026 figures, the theoretical maximum benefit for someone who contributed the maximum but retires at 62 would be significantly less than $4,152.
While exact projections for 2026 vary based on earnings history, historical SSA data illustrates that, in the past, the maximum benefit at age 62 has typically been around 70% of the FRA amount available.
What If I Wait Until 70 to Claim Social Security?
At the opposite end of the spectrum, patience pays off handsomely. For every year a beneficiary postpones claiming beyond their FRA, until age 70, the benefit increases by 8% annually. Therefore, a worker with an FRA at age 67 who waits until 70 could receive a benefit 24% higher.
At its maximum, this could amount to hundreds of extra dollars each month throughout retirement—a powerful incentive for those who can afford to wait and while the program is still able to pay the full benefits to those who are thinking about making the switch to the retiree life.
Warning for Those Who Work: Adjusted Income Limits
The 2.8% increase not only affects benefits but also the thresholds for the “retirement income test,” a rule that impacts those who choose to work while receiving benefits before reaching their FRA. This threshold has been adjusted upwards for 2026.
Benefit recipients who do not reach their FRA at any point in 2026 can earn up to $24,480 annually ($2,040 monthly) without penalty. For every $2 they earn above that limit, the SSA will withhold $1 from their benefits. The rule becomes more flexible the year the person reaches their FRA. The limit for 2026 is set at $65,160 annually ($5,430 monthly) for earned income before of the month of the FRA birthday.
In this case, $1 is withheld for every $3 earned above the threshold. Once the FRA is reached, the test is discontinued and no further withholding applies, regardless of income. Furthermore, the amounts withheld during this period are not lost; the SSA recalculates them and increases the monthly payment once the FRA is reached, to compensate for the withheld amount over time.
