Why Social Security payments in the United States can increase or decrease
Social Security payments vary for each beneficiary, but certain factors can raise or lower the amount.
Each month, the Social Security Administration (SSA) sends benefits to retired workers, survivors, recipients of Social Security Disability Insurance (SSDI), and Supplemental Security Income (SSI) beneficiaries.
The amount of each payment depends on the individual because benefits are calculated on a case-by-case basis. However, several factors can increase or decrease the amount of money the agency sends. Here is what you need to know.
Reasons Social Security payments may decrease or increase
Earnings history
The SSA uses your earnings history to determine your retirement benefit amount. In general, the more you earned and paid in taxes over your working years, the higher your benefits will be.
Early retirement
Workers can begin claiming retirement benefits at age 62. However, the SSA recommends waiting until full retirement age to receive 100 percent of your entitled benefit.
Full retirement age is the age at which the SSA considers you eligible to receive your full benefit amount. It depends on your year of birth. If you were born between 1943 and 1954, your full retirement age is 66. If you were born between 1955 and 1959, it gradually increases. For those born in 1960 or later, full retirement age is 67.
According to the SSA, someone whose full retirement age is 67 will receive about 30 percent less if they claim benefits at age 62. In addition, if you claim benefits before reaching full retirement age and continue working while earning above a certain annual limit, your payments may be reduced.
Delaying retirement
On the other hand, workers who delay claiming benefits beyond their full retirement age can receive higher payments. Those who wait until age 70 may receive more than 20 percent extra in monthly benefits.
The SSA explains that for each year you delay claiming benefits from your full retirement age up to age 70, your benefit increases by about 8 percent annually.
As a result, someone with a full retirement age of 67 who waits until age 70 could receive about 24 percent more in monthly payments.
Cost-of-living adjustment (COLA)
Each year, the SSA calculates a cost-of-living adjustment, or COLA, based on changes in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This adjustment is intended to protect beneficiaries’ purchasing power.
The COLA is determined by comparing CPI-W data from the third quarter of the previous year with the third quarter of the current year, specifically July, August, and September. In general, when inflation rises, Social Security payments increase as well.
The agency announces the official COLA for the following year in October, once all necessary data is available. In 2026, payments increased by 2.8 percent.
Medicare premiums
Social Security payments may also decrease because of Medicare premiums, which are typically deducted from monthly benefit checks.
Even if benefits increase due to the COLA, rising Medicare premiums could offset that increase. In some cases, beneficiaries may see a net reduction in their monthly payments.
Get closer to the game! Whether you like your soccer of the European variety or that on this side of the pond, our AS USA app has it all. Dive into live coverage, expert insights, breaking news, exclusive videos, and more. Plus, stay updated on NFL, NBA and all other big sports stories as well as the latest in current affairs and entertainment. Download now for all-access coverage, right at your fingertips – anytime, anywhere.
And there’s more: check out our TikTok and Instagram reels for bite-sized visual takes on all the biggest soccer news and insights.