Social Security benefits are changing in 2026, and understanding these adjustments is crucial for anyone planning to rely on these payments in retirement. While the changes may seem minor, the cumulative effect over decades can be substantial. Financial expert Suze Orman recently highlighted a key detail many retirees overlook: annual cost-of-living adjustments (COLAs) apply even if you haven’t started claiming benefits yet. This means waiting to file could significantly increase your future income.
The 2026 COLA: A Modest Increase
The Social Security Administration (SSA) has announced a 2.8% COLA for 2026. This adjustment aims to keep benefits in line with inflation, but it may not fully cover rising costs for essentials like housing and healthcare. The SSA uses a specific inflation measure that differs from broader consumer price indexes, meaning the boost might feel smaller than expected.
The Overlooked Benefit: COLA Before Claiming
One of the most important takeaways is that the COLA applies to your future benefit even before you turn 62 and start collecting. Every year you delay filing, your potential benefit grows, and that larger base amount will then receive the annual COLA. This is why timing matters so much.
Orman’s Advice: Delay to Maximize Income
Suze Orman consistently recommends delaying Social Security claims as long as possible. Waiting until your full retirement age (FRA), typically 67 for those born in 1960 or later, can yield a benefit roughly 30% higher than claiming at 62. Because the COLA applies even while you wait, delaying not only increases your base benefit but also amplifies the COLA applied to that larger sum.
How to Prepare for 2026 and Beyond
To make the most of Social Security, consider these steps:
- Factor COLA into your budget: A 2.8% increase may not keep pace with rising costs, so plan accordingly.
- Strategically delay filing: If you have other income sources, waiting until 67 or 70 can dramatically boost your lifetime benefits.
- Diversify income streams: Don’t rely solely on Social Security. Explore retirement accounts, annuities, or part-time work to ensure financial stability.
- Update your retirement plan: Consult a financial advisor to analyze your situation and determine the optimal claiming strategy.
The 2026 COLA of 2.8% is just one piece of the puzzle. Proactive planning and smart timing are essential to maximizing your Social Security income and securing a comfortable retirement.
