There are more than 75 million Americans who rely on Social Security and Supplemental Security Income for their expenditures. All of these recipients are now preparing for major changes in their benefits as 2026 approaches. The Social Security Administration had recently announced a 2.8% COLA adjustment.
Aside from COLA updates, recipients will also have to face increased medicare premiums and new tax thresholds. All these changes mean that the boost in benefits may not be as effective as expected.
BREAKING! 75 million Americans will get a 2.8 percent increase in monthly Social Security benefits and SSI payments in 2026. Check our blog for more information: https://t.co/5tyMKftWyD. pic.twitter.com/X0ZZR28a2j
— Social Security (@SocialSecurity) October 24, 2025
One of the biggest changes in Social Security that everyone was looking forward to was COLA adjustments. From January 2026, Social Security recipients will see an average increase of $56 in their benefits due to COLA adjustments. However, for SSI beneficiaries, these increases will come into effect from December 2025.
Though many retirees feel that the COLA adjustment of 2.8% and subsequent increase in benefits by $56 are not enough, SSA claims that these boosts in benefits reflect today’s economic realities.
AARP survey had revealed that 77% of adults find an increase of 2.8% insufficient to combat inflation in essentials like housing, healthcare and food.
Another big change in Social Security is the rise of the tax cap. The higher-income workers will now pay more into the system. Workers will face a major change when the Social Security payroll tax jumps from $176,100 to $ 184,500.
However, the tax rate of 12.4% shared between employer and employee would remain the same.
There will also be a change in earning limits for working retirees who wish to continue to work in the later stages of old age. For workers who are younger than full retirement age, the earnings have been increased to $24,480. For workers who are reaching their retirement age in 2026, the annual earning limit has been changed to $65,169. However, SSA may hold the benefits until the recipients have reached their full retirement age.
Being aware of these thresholds is important because anyone earning more than the cap may lose some benefits.
Earlier this year, the Trump administration passed its ambitious Big Beautiful Bill. Due to this, there will be a substantial increase in the premium for Medicare Part B.
Before you receive any Social Security benefits, the Social Security Administration (SSA) will need to determine your eligibility. https://t.co/wr3RyD3Knq pic.twitter.com/V3QZ3dXM9O
— Sean Howard (@SHowardLPL) November 17, 2025
Analyses have shown that the premium is expected to go up to $202.90 per month from $185. The premium for Medicare gets deducted directly from the Social Security checks. This means the hike in the premium amount will eat away a major portion of COLA-adjusted Social Security benefits.
Aside from monetary changes, the SSA has made changes in eligibility and disability criteria, too. Those seeking Social Security benefits should make at least $1,890, up from previous years. Similarly, the administration has raised the disability threshold for non-blind workers to $1,690 per month. At the same time, the Trial Week period limit has gone up to $1,210 per month.
All these changes in benefits, eligibility and disability mean that despite the increase in benefits due to COLA updates, one needs to be more careful with their budgets and financial planning in 2026.
