Learn About SSDI COLA 2026 Benefit Changes

What Is COLA and How Does It Work?

COLA stands for Cost-of-Living Adjustment. It is an annual increase to Social Security and Supplemental Security Income (SSI) payments. The Social Security Administration uses COLA to help beneficiaries keep up with inflation—the rising costs of everyday items like food, housing, and medicine.

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Think of COLA this way: If you received $1,200 per month in 2025 and inflation caused prices to rise by 3%, you might receive $1,236 per month in 2026 (a $36 increase). This adjustment attempts to maintain your purchasing power so your benefits can still cover your basic needs.

The amount of each year's COLA is determined by a specific formula. The Social Security Administration looks at the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) data from July, August, and September of each year. They compare these three months to the same months from the previous year. The percentage increase becomes the COLA percentage for the following year.

COLA adjustments apply to different benefit programs:

• Social Security Disability Insurance (SSDI)
• Supplemental Security Income (SSI)
• Social Security retirement benefits
• Survivors benefits for family members of deceased workers

The COLA adjustment happens automatically for most beneficiaries. You do not need to request it or take any action. The increase appears in your monthly payment without any paperwork required on your part.

Practical Takeaway: COLA is a tool designed to help your benefits maintain their value over time as prices rise. Understanding how it is calculated can help you plan your budget for the coming year.

The 2026 COLA Percentage and What It Means for Your Payments

The 2026 COLA has been announced as 2.5%. This means that most beneficiaries receiving SSDI, SSI, or other Social Security benefits will see their monthly payments increase by 2.5% starting in January 2026.

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Here are some examples of how this increase translates to actual dollar amounts:

• A beneficiary receiving $800 per month would receive an additional $20 per month (new total: $820)
• A beneficiary receiving $1,200 per month would receive an additional $30 per month (new total: $1,230)
• A beneficiary receiving $1,500 per month would receive an additional $37.50 per month (new total: $1,537.50)
• A beneficiary receiving $2,000 per month would receive an additional $50 per month (new total: $2,050)

The 2.5% COLA for 2026 represents an increase from the 2025 COLA of 3.2%. COLA percentages vary from year to year based on inflation data. In recent years, the United States experienced higher inflation rates, which resulted in larger COLA adjustments. The 2025 adjustment of 3.2% was notably higher than the 2026 adjustment of 2.5%, reflecting lower inflation in 2025 compared to 2024.

SSI beneficiaries should be aware that the Federal Benefit Rate (FBR)—the maximum monthly payment for SSI—will also increase by 2.5%. For 2026, the FBR for an individual is expected to increase to approximately $946 per month, up from $943 in 2025. For a couple, the FBR is expected to be approximately $1,415 per month.

It is important to understand that the 2.5% increase applies to your current benefit amount, not to a fixed dollar figure. This means higher-income beneficiaries will see a larger dollar increase, while lower-income beneficiaries will see a smaller dollar increase.

Practical Takeaway: Calculate your expected 2026 benefit amount by multiplying your current monthly payment by 1.025. This gives you a rough estimate of what you may receive starting in January 2026.

Changes to SSI Resource and Income Limits in 2026

Beyond the COLA increase to monthly payments, the Social Security Administration also adjusts the resource limits and income limits for SSI each year. These limits determine whether someone may be financially eligible to receive SSI benefits.

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For 2026, the SSI resource limits are expected to increase to:

• $2,750 for an individual (increased from $2,000 in previous years)
• $4,130 for a couple (increased from $3,000 in previous years)

The countable income limit for SSI eligibility is also adjusted annually. In 2026, the Federal Benefit Rate increase of 2.5% means that the income limit will rise proportionally. The basic income limit (the amount of monthly income you may have before it affects your SSI payment) will reflect this same percentage increase.

It is important to understand how SSI counts income. Not all income is counted equally. For example:

• Wages are partially excluded—the first $65 of monthly earnings plus half of remaining earnings are excluded
• Unearned income (like gifts or interest) is generally fully counted
• Some types of income may not be counted at all, such as certain food or shelter

These adjustments mean that people who were previously over the resource limit might fall within the new limits in 2026. Additionally, people whose income was previously too high might now be within the countable income limits when the 2.5% adjustment is applied.

However, these changes do not happen automatically for everyone. If you have previously been found to be over the income or resource limits, you should contact the Social Security Administration to learn about your current situation based on the new limits.

Practical Takeaway: If you have been denied SSI benefits due to exceeding resource or income limits in prior years, the 2026 limit changes may open new opportunities to explore your options.

Key Work Incentive Programs and How COLA Affects Them

The Social Security Administration offers several work incentive programs designed to help beneficiaries earn income while continuing to receive SSDI or SSI payments. The 2.5% COLA increase affects how these programs function.

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One major program is the Plan to Achieve Self-Support (PASS). A PASS is an agreement you create with Social Security that sets aside income and resources for a specific work goal. Money set aside under a PASS is not counted as income or resources when determining your benefit amount. The income limits and resource limits for PASS are tied to SSI limits, which means they will increase by 2.5% in 2026.

Another important program is Impairment Related Work Expenses (IRWE). If you have work-related expenses caused by your condition—such as specialized transportation, medical equipment, or personal assistance services needed to work—these expenses may be deducted from your earnings. This can reduce your countable income and allow you to keep more of your benefit.

The Ticket to Work program allows SSDI beneficiaries to work and continue receiving benefits while working with an approved employment network or vocational rehabilitation agency. While Ticket to Work itself does not have specific income limits, the work incentive programs tied to it, like PASS and IRWE, are affected by the COLA adjustments.

The Earned Income Exclusion is another basic work incentive. The first $65 of monthly earnings, plus half of remaining earnings above that, are excluded from countable income for SSI beneficiaries. This amount has historically been adjusted, though not every year. In 2026, this exclusion remains at $65, but the overall effect of the COLA increase means the Federal Benefit Rate—and therefore your ability to earn while maintaining your benefit—increases.

These programs exist to help beneficiaries explore work opportunities without losing all their benefits immediately. Understanding how COLA affects the income limits for these programs can help you determine how much you might be able to earn while continuing to receive some or