Inflation Spurs Boost to 2026 Social Security and Savings Limits

December 1, 2025

It is shocking to think 2026 is right around the corner. As we enter the final month of the year and complete our holiday shopping, it is tough to ignore the effects inflation has on consumers. However, inflation does impact savers by adjusting the amount we put away and receive in retirement. While originally delayed due to the government shutdown, the 2026 adjustments for social security, health savings accounts, and retirement accounts have been announced. Let’s take a look:

Social Security Cost of Living Adjustment (COLA)

The Social Security cost of living adjustment (COLA) is an annual change in the amount of benefits received based on inflation. Why? It helps social security recipients keep up with the rising costs of goods and services. For 2025, the COLA was 2.5%, as inflation continued its decline from a 40 year high. Inflation stalled this year, as the effects of tariffs have been felt, resulting in a COLA of 2.8% for 2026. As a result, social security recipients will see their benefit grow by $2.80 for every $100 they currently receive starting in January. 

Health Savings Account Contribution Limit

Individuals using a high deductible health plan with a health savings account (HSA) can contribute up to $4,400 in 2026, a 2.3% increase from 2025. For those with family coverage, the limit will be $8,750, a 2.4% increase. The catch-up contribution limit will remain unchanged at $1,000 for those 55 and older.

As a reminder, HSA’s are a great tool for building wealth. They are triple-tax free, which means you can make tax-free contributions, grow tax-deferred earnings, and make tax-free withdrawals for qualified health care expenses. If you are interested in setting up a new HSA, contact us today to get started.

401(k) Maximum Contribution Limit

The amount individuals can contribute to their 401(k) plans in 2026 will increase to $24,500, up from $23,500. The catch-up contribution limit for those aged 50 and over will increase to $8,000, up from $7,500. This results in a maximum contribution for those 50 and older of $32,500. Also, what began last year, a “super catch-up” will allow employees reaching age 60-63 in the calendar year to qualify for a higher catch-up contribution limit of $11,250 instead of $8,000. 

Individual Retirement Account (IRA) Contribution Limit

The maximum annual IRA contribution will increase to $7,500 from $7,000 with a catch-up contribution limit of $1,100, an increase from $1,000 last year. 

All these changes give people the opportunity to save more for retirement. While the maximum contribution limits may not affect everyone, it is important to think about increasing your own contribution yearly. Small increases can make a significant long-term difference with the power of compounding. If you would like to review your future goals or how any changes may affect your portfolio, reach out to an advisor today for an in-depth review of your portfolio.  Your success matters to us.