3 Huge Social Security Changes Taking Effect in January 2026

Starting in 2026, Social Security recipients can expect a 2.8% cost-of-living adjustment (COLA). The average retired worker collects around $2,012 per month, according to November 2025 data from the Social Security Administration, resulting in a raise of around $56 per month.

But the new COLA isn't the only change coming next year. Retirees and those closing in on retirement can expect a slew of updates coming in 2026 -- some of which are positive, while others might sting.

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1. Higher earnings test

If you continue to earn income from a job while receiving Social Security benefits, your monthly payment could be temporarily reduced if you earn above a certain limit. This limit is the retirement earnings test, and it typically changes from year to year to account for cost-of-living changes.

There are two limits: one for those who are under their full retirement age (FRA) for the entirety of 2026, and a second for those who will reach their FRA in 2026. If you're already past your FRA, the earnings test does not apply to you, and your income won't affect your benefit amount.

In 2026, both of the earnings test limits will increase. That's good news for Social Security recipients, as it means you'll be able to earn more in wages before facing benefit reductions.

Source: Social Security Administration. Table by author.

No matter how much your benefits are reduced, these withholdings are only temporary. At your FRA, you'll begin receiving adjusted payments to account for the deductions. That said, it's still wise to consider how much your monthly checks may be reduced in the short term to avoid any surprises in retirement.

2. Higher maximum benefit

The highest possible Social Security payment will go up next year, from $5,108 per month in 2025 to $5,251 per month in 2026. That's nearly $2,000 more per year for higher earnings.

To reach the maximum benefit, there are a few requirements you'll need to meet:

• Work for at least 35 years: Your benefit is calculated by taking an average of your earnings over the 35 highest-earning years of your career. That number is then run through a complex formula and adjusted for inflation, and the result is the amount you'll receive at your FRA.
• Delay claiming until age 70: Claiming at your FRA will earn you 100% of your earned benefit, but that's not the maximum payment. To earn as much as possible from Social Security, you'll need to delay claiming by a few more years until age 70. While you can wait until after age 70 to file, it won't further increase your benefit.
• Consistently reach the maximum taxable earnings limit: The maximum taxable earnings limit is the highest income subject to Social Security tax. To earn the max benefit, you'll need to have consistently reached this limit throughout your career.

Achieving the maximum benefit is incredibly challenging, so it will be out of reach for most people. But if you can get there, expect to receive a higher payment in 2026.

3. Higher maximum taxable earnings limit

Perhaps the trickiest factor in earning the maximum benefit is the salary requirement. Reaching the maximum taxable earnings limit is tough as it is, but it's even more challenging when the cap increases year after year.

In 2026, the earnings limit will be a whopping $184,500 per year, up from $176,100 in 2025. If you began your career 35 years ago in 1990, the earnings limit back then was $51,300 per year.

To earn the highest possible Social Security benefit, you'll need to have reached these limits consistently throughout your career. The good news, though, is that even if you're off track for the max benefit, increasing your income even slightly can still result in a larger monthly payment.

As we head into 2026, now is the time to prepare your Social Security strategy. Whether you're already retired or plan to start taking benefits next year, knowing what changes to expect is crucial for a more financially secure retirement.

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