The Social Security Administration (SSA) has confirmed that the maximum benefit for retirees applying for benefits at full retirement age will increase in 2026. This change is a direct result of the 2.8% cost-of-living adjustment announced (COLA) on October 24. The announcement, originally scheduled for October 15, was delayed due to the federal government shutdown.
As a result of this adjustment, the maximum monthly payment for a worker retiring at their full retirement age will be $4,152 per month. This represents an increase compared to the maximum benefit of $4,018 per month in effect during 2025. The change will affect millions of beneficiaries, whose monthly payments will be adjusted starting in January.
Calculate Your New Social Security Benefit for 2026
Additionally, the administration announced other changes that will take effect next year. These include an increase in the taxable earnings limit and adjustments to the income thresholds for beneficiaries who continue working while receiving their retirement payouts.
To qualify for the maximum benefit, a worker must have earned the maximum Social Security taxable wage each year, starting at age 22. This requirement underscores the direct correlation between lifetime earnings and the benefit amount received during retirement.
The impact of the 2.8% COLA extends beyond the maximum beneficiary. The average benefit for all retired workers is projected to increase to $2,071 per month in 2026, up from $2,015 per month in 2025. Similarly, the average benefit for workers receiving disability benefits will rise to $1,630, compared to $1,586 the previous year.
The concept of full retirement age is fundamental in this context, as it marks the point at which a worker can access 100% of their accrued benefits. Individuals who choose to postpone their retirement beyond this age can receive increased payments. Specifically, for each year of delay until age 70, the benefit increases by 8%.
| Beneficiary Category | Before 2.8% COLA | After 2.8% COLA |
|---|---|---|
| All Retired Workers | $2,015 | $2,071 |
| Aged Couple, Both Receiving Benefits | $3,120 | $3,208 |
| Widowed Mother and Two Children | $3,792 | $3,898 |
| Aged Widow(er), Alone | $1,867 | $1,919 |
| Disabled Worker, Spouse and One or More Children | $2,857 | $2,937 |
| All Disabled Workers | $1,586 | $1,630 |
Source: Official data from the Social Security Administration
Consequences of early application for benefits
Those who decide to claim benefits at age 62, the earliest age allowed, face a permanent reduction in their benefit amount. This decision entails a cut calculated based on life expectancy and the early start of receiving the funds. Workers who are below their full retirement age and simultaneously receive earned income will be subject to new limits in 2026. The regulation, called the retirement income test, establishes that these beneficiaries can earn up to $24,480 annually, equivalent to $2,040 per month.
For every $2 that exceeds this established limit, $1 will be withheld from your Social Security benefits. In 2025, this threshold is set at $23,400 annually, or $1,950 monthly. This mechanism aims to adjust benefit payments for retirees who still maintain a significant source of earned income.
Provisions for workers nearing full age
Bill Shafranksy, a certified financial planner and senior wealth advisor with Moneco Advisors in New Canaan, Connecticut, commented on this situation: “Not only could they face a massive reduction in their benefit, but sometimes I’ve seen it where the benefit actually drops to zero completely.”
For individuals reaching full retirement age during 2026, a higher income threshold applies. In these cases, the annual limit is set at $65,160, or $5,430 per month. If their earnings exceed this amount, $1 will be withheld from their benefits for every $3 over the limit.
It is important to note that the benefits withheld as a result of this income test are not permanently lost. The Social Security Administration indicates that these amounts are gradually added to monthly benefits once the individual reaches full retirement age.