It's Not Just a COLA: 3 Updates the Social Security Administration Should Share in October

If you're seeing Social Security in the news a lot lately, there are a couple of reasons. The first is that the program's trustees recently shared an unfavorable financial update. To make a long story short, benefit cuts could happen as soon as 2032 if lawmakers don't act.

The other Social Security headlines you might be seeing may relate to the program's upcoming cost-of-living adjustment, or COLA. Social Security benefits are eligible for a COLA each year to help those payments keep up with inflation. After a lackluster 2.8% COLA this past January, many retirees are hoping next year's raise will be far more generous.

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If you're curious about Social Security's financial future and what lawmakers will do to prevent benefit cuts, you may need to sit tight for a while. Congress doesn't seem to be in a rush to address the program's pending shortfall. However, if you want to know what next year's COLA looks like, the wait may be less substantial.

Social Security COLAs are based on third-quarter changes to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Once the September CPI-W data comes out, the Social Security Administration (SSA) should be able to make its 2027 COLA official.

September's data is set to be released on Oct. 14. Barring no disruptions (which is worth mentioning, since last year's government shutdown delayed this data), the SSA should be able to share a confirmed 2027 COLA on that day as well.

But that's not the only key update to expect on Oct. 14. Here are three more important pieces of information the SSA should reveal in mid-October.

1. The 2027 earnings-test limits

Social Security recipients are allowed to earn money from a job while receiving benefits. But those who do so before reaching full retirement age are subject to an earnings test. And exceeding its limit could mean having benefits withheld temporarily.

The 2026 earnings-test limit is $24,480 for Social Security beneficiaries who will not reach full retirement age by the end of the year. Beyond that point, $1 in Social Security is withheld per $2 of earnings.

This year's earnings-test limit is higher for people who will reach full retirement age by the end of the year. In that case, the limit is $65,160. And beyond that point, only $1 in Social Security per $3 of income is withheld.

The earnings-test limit commonly rises from year to year. As such, there's a good chance Social Security recipients will have an opportunity to earn more money in 2027 before risking withheld benefits.

This assumes, of course, that lawmakers don't do away with the earnings test. There's a new bill that's been introduced called the Senior Citizens' Freedom to Work Act, whose purpose is to repeal the earnings test. However, since it's in its early stages, it's fair to assume that this rule will hold in 2027.

2. The 2027 wage cap

Social Security's main source of funding is payroll tax revenue. But workers only pay into Social Security on a certain level of wages that changes each year.

This year, workers' first $184,500 of income is taxed for Social Security. Earnings beyond that point are exempt.

In 2027, the wage cap is likely to increase, so higher earners should expect a higher Social Security tax bill. That's important, because the more payroll taxes the program collects, the more protection retirees get against benefit cuts.

3. The maximum monthly benefit for 2027

Because Social Security has a wage cap, it also has a maximum monthly benefit. This year, the maximum monthly benefit at full retirement age is $4,152. Next year's maximum monthly benefit should rise as well.

But some Social Security recipients may be getting more than $4,152 per month this year. That number is the maximum benefit at full retirement age, but recipients can delay their claims beyond that point for boosted checks. Each year of waiting results in a guaranteed 8% increase in benefits for life, up until age 70.

The Social Security COLA announcement is likely to take center stage in October. But you should know that the SSA generally shares other pivotal information that day. It's important to know what to expect so you can look out for changes that may have an impact on you.

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