Social Security's 2027 COLA Is Coming in October. Here's What Changes Besides Your Monthly Check
Every January, Social Security checks receive a cost-of-living adjustment designed to help beneficiaries cope with rising costs due to inflation. The Social Security Administration will announce the amount of the COLA for 2027 on Oct. 14, per the Senior Citizens League. On that day, millions of retirees will be watching to see how much bigger their monthly checks will get.
While the COLA figure is the one you’re most likely to hear on the news, the SSA will also be releasing other important figures that day as well. Specifically, the SSA is likely to provide new limits on how much you can earn while collecting benefits before full retirement age, how much of your paycheck is subject to Social Security taxes and how much you have to earn to qualify for benefits in the first place.
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Some of these changes could actually have a bigger impact on your finances than the COLA figure, especially if you’re still working. Here’s what to watch.
More of Your Paycheck Could Be Subject to Social Security Taxes
For 2026, the 6.2% payroll tax is limited to a worker’s first $184,500 of earnings. That number is expected to increase in 2027, meaning more of a high earner’s paycheck could get hit with Social Security taxes.
Self-employed workers face an even bigger potential increase because they generally pay both the employer and employee portions.
While the COLA is tied to increases in the CPI-W inflation rate, this adjustment is based on changes in national average wages.
You'll Be Able to Earn More While Collecting Benefits
In 2026, if you continue to work before reaching full retirement age, the SSA will withhold $1 in benefits for each $2 you earn above $24,480.
The limit is more generous in the year you reach full retirement age. For 2026, that limit rises to $65,160, with $1 withheld for every $3 earned above that amount before your birthday month.
Both limits are expected to increase in 2027, allowing working retirees to earn a bit more without having to worry about their benefits being withheld.
Bear in mind that any withholdings are eventually returned, as the SSA will readjust your future checks higher to account for the withholdings after you reach full retirement age. You’re also allowed to earn as much as you’d like without worrying about withholding once you reach FRA.
Qualifying for Social Security Will Take More Earnings
Although it’s often said that you need to work for 10 years to qualify for Social Security, that’s a bit of shorthand that’s not entirely accurate.
Per SSA rules, workers must earn 40 Social Security credits to qualify for retirement benefits. The 10-year shorthand comes from the fact that you can only earn a maximum of four credits per year. But the reality is that you earn one credit for every $1,890 in covered earnings, meaning $7,560 is enough to collect all four credits for the year.
So, while it may actually take you 10 years to accumulate the needed credits, you don’t actually have to put in 10 years of 40-hour work weeks.
In 2027, that earnings limit will likely rise. While that number doesn’t really matter for full-time workers, if you’re only working part-time or earning a small amount from side gigs, it can be an important number to know to ensure you earn enough Social Security credits.
The SSA will announce the new amount at the same time it releases the annual COLA.
Disability and SSI Benefits Will Change, Too
Disability and Supplemental Security Income (SSI) payments are part of the Social Security system as well, so the SSA will be announcing payout changes for these programs as well.
In 2026, the SSA reported that the maximum federal payout for SSI recipients was $994 per month for individuals and $1,491 for eligible couples.
In Oct. 2026, the SSA will report increases for these figures as well, along with the earnings thresholds used to determine “substantial gainful activity” for disability recipients.
Medicare Could Eat Into Your Raise
An increase in the COLA will no doubt be a welcome relief for Medicare beneficiaries, who often have their Part B premiums deducted from their Social Security payments. But Medicare premiums are announced separately from the Social Security COLA. You won’t know exactly how much extra money you’ll actually keep from your COLA until the Medicare premium figures are also released.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.