The Social Security program undergoes changes each year to keep benefits aligned with rising prices and wages across the economy. But the Nationwide Retirement Institute recently published its 2025 Social Security Survey, and the results suggest three changes set to take effect in 2026 will surprise many Americans.
Here are the important details.
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1. Social Security benefits will be adjusted to account for inflation
The Nationwide Retirement Institute reports that more than two-thirds of surveyed adults incorrectly marked this statement as true: "Social Security is not protected against inflation."
Social Security benefits are indeed protected from inflation by cost-of-living adjustments (COLAs) doled out annually based on changes in the Consumer Price Index. The Social Security Board of Trustees estimates the 2026 COLA will be 2.7%. That matches the most recent forecast from The Senior Citizens League, and it means the 2026 COLA is on pace to be slightly larger than the 2025 COLA.
The following chart details how the average monthly payout for different types of beneficiaries would change after the estimated 2.7% COLA takes effect in January.
|
Beneficiary Type |
Average Benefit Before 2.7% COLA |
Average Benefit After 2.7% COLA |
Increase |
|---|---|---|---|
|
Retired workers |
$2,008 |
$2,062 |
$54 |
|
Spouses |
$955 |
$981 |
$26 |
|
Survivors |
$1,575 |
$1,618 |
$43 |
|
Disabled workers |
$1,583 |
$1,626 |
$43 |
Data source: Social Security Administration. The average benefit before the estimated 2.7% COLA reflects the average payments made in August 2025.
The Social Security Administration will announce the 2026 COLA shortly after the Bureau of Labor Statistics releases its September inflation report on Oct. 15.
2. Social Security beneficiaries under full retirement age will be able to earn more money before benefits are withheld
The Nationwide Retirement Institute reports that more than one-third of surveyed adults incorrectly marked this statement as false: "Some of your benefits may be withheld if you're still working before your full retirement age (FRA)."
Workers on Social Security will indeed have some benefits temporarily withheld if they are under FRA and have income above the retirement earnings test (RET) amounts. The lower limit applies to beneficiaries who will not reach FRA during the year, while the upper limit applies to beneficiaries who will reach FRA during the year.
Here's how it works: The lower limit is $23,400 in 2025. Workers who will not reach FRA this year have $1 benefits withheld for every $2 in income above the lower RET limit. Similarly, the upper limit is $62,160 in 2025. Workers who will reach FRA this year have $1 in benefits withheld for every $3 in benefits above the limit. The retirement earnings test no longer applies after FRA.
The RET limits generally increase each year to account for changes in the average wage, meaning affected beneficiaries can usually earn a little more money before Social Security payments are withheld. The Social Security Administration will announce the 2026 RET limits on Oct. 15, but the trustees estimate that the lower limit will increase to $24,360 and the upper limit will increase $64,800.
3. Some high-income workers will owe more in Social Security payroll taxes
The Nationwide Retirement Institute reports nearly three-quarters of surveyed adults incorrectly marked this statement as true: "Workers pay Social Security taxes on all of their income." Also, two-thirds of surveyed adults incorrectly marked this statement as false: "Somebody who makes $200,000 pays as much in Social Security taxes as millionaire."
Social Security is primarily funded through payroll taxes, but the amount of income subject to that tax is limited by law. The maximum taxable earnings limit is $176,100 in 2025, which means any income above that amount is not taxed by Social Security. That means a worker who earns $200,000 this year will indeed pay the same amount in taxes as someone who earns $2 million.
However, the taxable maximum tends to increase over time to account for changes in the average wage. The Social Security Administration will announce the updated limit for 2026 on Oct. 15, but the trustees estimate it will reach $183,600. In that scenario, an extra $7,500 would be subject to the payroll tax. And the payroll tax rate for most employees is 6.2%, which means some workers will own an additional $465 in 2026.
