Once you start collecting Social Security, the size of your checks will change every year. The most visible adjustment is the annual cost-of-living adjustment (COLA). Designed to offset inflation, the 2026 COLA came in at 2.8%, adding roughly $56 per month to the average retired worker’s check and pushing the typical benefit to about $2,071. Looking ahead, early projections from the Senior Citizens League put the 2027 COLA at 3.8%, though the official figure will not be announced by the Social Security Administration (SSA) until October.
Beyond the COLA, the SSA also recalculates your earnings each year if you continue to work after claiming benefits. That ongoing review can work in your favor or against you, depending on when you started collecting.
How Working After Retirement Can Raise Your Benefits
Social Security benefit amounts are built on your work history. The SSA formula identifies the 35 years when you earned the most money and uses those figures to compute your monthly payment. If you keep working and a new year of earnings tops one of those 35 years, the SSA swaps out the lowest year on record. That substitution raises the base figure used to calculate your benefit.
“Each extra year you work adds another year of earnings to your Social Security record,” the SSA explains. “Higher lifetime earnings can mean higher benefits when you retire.”
This dynamic matters especially for workers who did not log a full 35 years in covered employment. When the SSA calculates benefits for someone with fewer than 35 qualifying years, it fills the remaining slots with zeros. Continuing to work after retirement replaces those zero years with actual earnings, and every substitution pushes the monthly payment higher.
When Benefits Can Decrease
Claiming Social Security before full retirement age can shrink your monthly checks in two distinct ways. You can start as early as age 62, but the current full retirement age is 67 for anyone born in 1960 or later. For those born between 1943 and 1954 the full retirement age is 66, and it phases up gradually for birth years 1955 through 1959.
The first hit is permanent: early claimants receive a reduced base benefit for life. Someone who turns 62 in 2026, for example, would lock in a benefit roughly 30% below what they would have received by waiting until 67, according to the SSA. Delaying past full retirement age works in reverse. The SSA adds 8% to your benefit for each full year you hold off, up through age 70, meaning a 70-year-old claimant can receive a substantially larger monthly check than one who started at 67.
The second impact is the retirement earnings test, which applies only while you are below full retirement age. For 2026, the annual earnings limit for those who will remain below full retirement age all year is $24,480. Earn above that and the SSA withholds $1 in benefits for every $2 of excess earnings.
A higher threshold applies in the specific calendar year when you reach full retirement age. For 2026, that limit is $65,160, and the penalty is softer: the SSA reduces benefits by $1 for every $3 earned above the cap, but only for the months before your birthday. Once you hit full retirement age, the earnings test disappears entirely. You can earn any amount without any reduction to your benefit going forward.
To make this concrete: if your full retirement age birthday falls in September, the earnings test only affects benefits paid in January through August of that year. From September onward, your earnings no longer factor into the calculation.
This recalculation runs automatically each year using tax records, but you can track your earnings history directly by creating an account at SSA.gov. The agency also provides a retirement earnings test calculator to estimate the impact on your specific benefit.
One final point worth flagging: delaying Social Security does not mean you can also delay Medicare. In most cases you should still enroll in Medicare at age 65, regardless of when you plan to start drawing Social Security. Missing that deadline can trigger permanent premium penalties that offset any gains from waiting on your retirement benefit.
Editor’s note: This article was updated to include the SSA’s 2026 COLA figure of 2.8% and the resulting average benefit increase of roughly $56 per month, along with the Senior Citizens League’s July 2026 projection of a 3.8% COLA for 2027, and corrected an erroneous “SAA” abbreviation to the proper “SSA.”
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