Social Security 2026 Tax Cap, 2.8% COLA

When you claim Social Security greatly affects your monthly benefit: claiming at 62 can cut benefits by about 30% compared with full retirement age (typically 67), while delaying past FRA earns delayed‑retirement credits of roughly two‑thirds of 1% per month (about 8% per year) up to age 70. Average monthly benefits are roughly $2,034 for 67‑year‑olds and about $1,414 for 62‑year‑olds, illustrating the cost of early claiming. Some people must claim early for health or financial reasons, and surveys show only a small share plan to wait until 70. A “bridge” strategy — using savings, annuities, bond ladders or other income — can help finance the years until age 70 to secure larger payments. The SSA announced a 2.8% COLA and raised the 2026 Social Security taxable maximum to $184,500, meaning higher earners will pay more payroll tax. The SSA’s Adjustment to the Reduction Factor (ARF) can restore some amounts withheld under the earnings test, and recent legislation such as the Social Security Fairness Act has ended provisions that reduced benefits for some public employees.