New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

Alcoa Employees: Preparing for the 2026 Social Security COLA Increase

Healthcare Provider Update: Healthcare Provider for Alcoa Alcoa has partnered with several healthcare plans to provide its employees with benefits, primarily utilizing the services of major health insurance providers. For many employees, Alcoa's health coverage encompasses offerings from companies like Anthem Blue Cross Blue Shield and Aetna, focusing on comprehensive coverage options that include medical, dental, and vision plans. Potential Healthcare Cost Increases for Alcoa in 2026 As we look ahead to 2026, healthcare costs are projected to rise significantly, primarily driven by increases in ACA marketplace premiums. Nationally, insurers are requesting median premium hikes of approximately 20%, with individual states seeing increases as high as 66%. The expiration of enhanced federal premium subsidies adds further pressure, potentially leading to a staggering 75% increase in out-of-pocket costs for many enrollees. For Alcoa employees, these factors will likely mean a reevaluation of healthcare spending and strategic planning to mitigate escalating out-of-pocket expenses in the coming year. Click here to learn more

'With the 2026 Social Security COLA set to increase income for many Alcoa employees in retirement, thoughtful coordination of benefits and withdrawals is essential, as rising income can also elevate tax exposure.' —Wesley Boudreaux, a representative of The Retirement Group, a division of Wealth Enhancement.

'While the Social Security COLA boost may offer added income for Alcoa employees entering retirement, it’s important to plan carefully, as higher benefits can also raise taxable income over time.'—Patrick Ray, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

How the 2026 Social Security cost-of-living adjustment (COLA) impacts Alcoa retirees.
Tax implications of higher Social Security benefits and ways to manage them.
Timing strategies for Social Security benefits and available deductions for retirees.

What Alcoa Retirees Need to Know About Social Security COLA 2026

The Social Security cost-of-living adjustment (COLA) for 2026 is set at 2.8%, slightly higher than the previous year’s 2.5% increase. ¹ This annual COLA, announced by the Social Security Administration (SSA) in October and applied to January benefits, helps retirees maintain purchasing power during inflationary periods. For Alcoa employees nearing or in retirement, this adjustment can play a key role in income planning.

According to the Bureau of Labor Statistics, the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W)—which determines COLA—increased 3% over the 12 months ending September 2025. ²

While this is lower than the 8.7% increase in 2023, ³ it may still offer meaningful relief to Alcoa retirees experiencing higher living expenses.

How Higher Benefits Could Affect Taxes

As Social Security benefits rise, your combined (or “provisional”) income may increase, which can cause a greater portion of your benefits to be taxed. Combined income includes wages, pensions, interest, dividends, taxable withdrawals from traditional 401(k)s or IRAs, non-taxable interest, and half of your Social Security benefits.

For single filers with income below $25,000 and joint filers below $32,000, Social Security benefits are not taxed. Between $25,000 and $34,000 for single filers and $32,000 and $44,000 for joint filers, up to 50% of benefits may be taxable. Income above those ranges can result in up to 85% of benefits being taxable. ³ These income thresholds are not adjusted for inflation, which means Alcoa retirees may experience increased taxation over time as income rises.

Withdrawals from traditional Alcoa retirement plans, such as 401(k)s and IRAs, are treated as ordinary income and can increase the taxable portion of Social Security benefits. Thoughtful timing of withdrawals may help manage tax exposure.

Strategies to Manage Tax Impact

If rising taxes are a concern, the following strategies may help:

Balance withdrawals across account types. Coordinating distributions from tax-deferred, taxable, and Roth accounts may help you meet required minimum distribution (RMD) rules while managing your tax bracket.
Use taxable accounts strategically. Only capital gains—not your initial investment—are taxable.
Consider tax-free withdrawals. Qualified distributions from Roth IRAs, Roth 401(k)s, or Health Savings Accounts (HSAs) are not included in taxable income and do not affect Social Security taxation.

New Senior Tax Deduction: 2025–2028

Beginning in 2025, a new senior deduction of $6,000 per person ($12,000 for joint filers) will be available to taxpayers age 65 and older. This deduction phases out at $75,000 adjusted gross income (AGI) for single filers and $150,000 for joint filers.

This deduction is in addition to the age-65+ standard deduction increase of $2,000 for single filers and $1,600 per eligible spouse for joint filers in 2025. Alcoa retirees may wish to include this in long-term tax planning.

Timing Your Social Security Benefits

Delaying Social Security until full retirement age (67) or up to age 70 generally results in higher lifetime benefits. Benefits increase by about 8% for each year you delay claiming between your full retirement age and age 70.

For Alcoa retirees, delaying benefits may provide additional flexibility in coordinating income from pensions, savings, or retiree medical accounts.

Social Security provides inflation-adjusted income for life, which may contribute to financial stability when aligned with corporate retirement benefits.

Keep the Big Picture in Mind

While the 2026 COLA helps counter rising costs, it can also raise taxable income for some retirees. Thoughtful planning around withdrawals, deductions, and timing of benefits can help manage long-term taxes. Because tax laws are complex, developing a multi-year strategy with a financial advisor is recommended.

The Retirement Group can help Alcoa employees explore Social Security strategies, tax-focused withdrawal planning, and retirement income coordination. For more information, call The Retirement Group at (800) 900-5867 .

Featured Video

Articles you may find interesting:

Sources:

1. Social Security Administration. Social Security Announces 2.8 Percent Benefit Increase for 2026 . U.S. Government, 24 Oct. 2025, https://www.ssa.gov/news/en/press/releases/2025-10-24.html .

2. Bureau of Labor Statistics. ' Consumer Price Index Summary ,' September 2025.

3. Markowitz, Andy. “Why Social Security COLAs Can Increase Your Taxes.” AARP , 6 Feb. 2024, updated 10 Feb. 2025, https://www.aarp.org/social-security/benefits-taxes-cola/ .

What are the key eligibility requirements for employees to participate in the Pension Plan for Certain Hourly Employees of Alcoa USA Corp, and how do these requirements change if an employee is hired or rehired after April 1, 2022? This question aims to explore the specific criteria that must be met for participation in the plan, providing clarity on both the general eligibility for new employees and any exceptions for those previously employed.

Eligibility Requirements: Employees are automatically eligible for the Pension Plan for Certain Hourly Employees of Alcoa USA Corp if they were hired or rehired before April 1, 2022, have reached age 21, and completed one year of vesting service. Employees hired or rehired on or after April 1, 2022, are not eligible for this pension plan(Alcoa USA Corp_Pension …).

How is the vesting service calculated in the context of the Alcoa USA Corp pension plan, and what implications does it have for an employee considering retirement? Understanding the nuances of how vesting service is accrued and the minimum time required to become vested can significantly impact an employee's retirement planning.

Vesting Service Calculation: Vesting service determines when an employee becomes eligible for pension benefits. Employees become vested after completing five years of vesting service, which includes both periods of pension service and non-pension service such as absences not counted towards pension service. This is crucial for retirement planning, as it ensures employees are entitled to pension benefits even if they leave the company after becoming vested(Alcoa USA Corp_Pension …).

What various retirement options are available to employees of Alcoa USA Corp, and how do these options affect the benefits and payout structure for retiring employees? This question addresses the multiple choices employees face when planning their retirement, including the differences between normal retirement, early retirement, and disability retirement benefits.

Retirement Options: The plan offers normal retirement (at age 65 with five years of vesting service), 60/10 retirement (for employees between 60 and 62 with 10 years of vesting service), and 62/10 retirement (for employees between 62 and 65 with 10 years of vesting service). Disability retirement is also available for those permanently incapacitated with 10 years of vesting service(Alcoa USA Corp_Pension …).

Can you elaborate on the survivor benefits provided under the Alcoa USA Corp pension plan, and what steps need to be taken to ensure that a spouse or partner is eligible for these benefits upon the employee's retirement? This question seeks to examine the protections and financial security afforded to survivors, alongside the required documentation and choices available to employees.

Survivor Benefits: The pension plan provides automatic surviving spouse coverage unless waived by the employee and spouse. Surviving spouse pensions are payable if the employee dies while actively employed and vested in the plan, after retirement, or while receiving a deferred vested pension. The spouse must submit a written application to claim benefits(Alcoa USA Corp_Pension …)(Alcoa USA Corp_Pension …).

What are the specific methodologies used to calculate the regular monthly pension for employees retiring under the Alcoa USA Corp pension plan, and how might these calculations vary based on an employee's age and years of service? This question looks at the complex actuarial factors that influence pension benefits, enhancing employees' understanding of how their retirement income is determined.

Pension Calculation: The regular monthly pension is calculated using a formula based on the employee's pension service and a pension factor in effect when pension service ends. For example, if an employee retires at 65 with 10 years of service, the pension factor might be $57 per year of service. The pension is adjusted based on age and service length(Alcoa USA Corp_Pension …).

In the event of a disability, how does the Alcoa USA Corp pension plan provide support to affected employees, and what are the requirements to qualify for disability retirement benefits? This question emphasizes the importance of understanding disability provisions, ensuring employees are aware of their rights and the circumstances under which they might qualify for benefits.

Disability Retirement: Employees under 62 who are permanently incapacitated with at least 10 years of vesting service qualify for disability retirement. They must be deemed permanently disabled and unable to return to work in a bargaining unit occupation. A medical examination may be required to confirm ongoing eligibility(Alcoa USA Corp_Pension …).

What steps must Alcoa USA Corp employees take to apply for retirement benefits, and what timelines are involved in the processing and payout of these benefits? This question delves into the procedural aspects of retirement applications, aiming to prepare potential retirees for the necessary actions they must undertake.

Retirement Application Process: Employees must file a retirement application with the plan administrator before their desired retirement date. The application can be filed up to 90 days before retirement, and the process typically includes receiving benefit explanations and payment elections within this timeframe(Alcoa USA Corp_Pension …).

How does the Pension Benefit Guaranty Corporation (PBGC) influence the pension benefits received by employees of Alcoa USA Corp, particularly in the context of plan terminations or financial challenges? This question explores the security provided by the PBGC, focusing on its role as a backup for employeesâ€™ pension benefits.

Pension Benefit Guaranty Corporation (PBGC): The PBGC provides a safety net for pension benefits in the case of plan termination or financial distress. If the pension plan is underfunded, the PBGC ensures employees still receive pension benefits, although certain limitations may apply(Alcoa USA Corp_Pension …).

What resources and support does Alcoa USA Corp provide to its employees for understanding their pension plan, and how can employees reach out for assistance regarding their retirement options? This question emphasizes the resources available to employees for further education and guidance, ensuring they know where to turn for help.

Resources for Understanding the Plan: Employees can access information about their pension plan and retirement options through the Alight Worklife™ website or by calling the Alcoa benefits helpline. These resources offer guidance on applying for retirement and understanding plan benefits(Alcoa USA Corp_Pension …).

How can employees of Alcoa USA Corp contact the benefits management team to learn more about their specific pension plan details, and what channels are available for inquiries? Understanding the communication channels can empower employees to seek the information they need, facilitating a smoother transition into retirement.

Contacting Benefits Management: Employees can reach out to the benefits management team through the Alight Worklife™ website or by phone at 1-844-31ALCOA. This service provides assistance with pension-related inquiries and retirement applications(Alcoa USA Corp_Pension …).

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Alcoa Corporation offers a defined benefit pension plan for certain retirees, known as the Alcoa Retirement Plan. In 2022, Alcoa transferred $1 billion in pension obligations to an annuity, maintaining benefit levels for retirees. Eligibility typically requires a combination of years of service and age. Alcoa also offers a 401(k) plan with a company match of up to 6% of employee contributions. Employees can make traditional and Roth contributions, with immediate vesting for all contributions. [Source: Alcoa Benefits Summary, 2022, p. 12]

Restructuring and Leadership Changes: Alcoa announced a significant restructuring of its Executive Leadership Team effective February 1, 2023, to enhance operational excellence, cost management, and innovation. Key changes include William F. Oplinger becoming EVP and Chief Operations Officer, Molly Beerman being appointed as EVP and Chief Financial Officer, and Renato Bacchi taking on added responsibilities as EVP, Chief Strategy & Innovation Officer. These changes aim to align the company's strategy with its vision to reinvent the aluminum industry and integrate corporate strategy with innovative technologies (Source: Alcoa Corporation). Layoffs and Operational Adjustments: Alcoa took a $6 million charge related to layoffs at its Kwinana alumina refinery in Australia, part of a broader restructuring program. This decision was driven by operational setbacks and permitting issues in Australia. Additionally, the company has reduced the number of planned layoffs at its Warrick Operations from an estimated 600 to about 325. This reduction reflects ongoing adjustments to improve efficiency and align with market conditions (Sources: Mining Weekly, Indianapolis Business Journal).

Alcoa provides stock options and RSUs as part of its equity compensation programs. Stock options allow employees to purchase company stock at a fixed price after a vesting period, while RSUs are awarded with a promise of company shares upon meeting certain conditions. In 2022, Alcoa granted both stock options and RSUs to employees, focusing on performance-based RSUs to drive long-term goals. This continued in 2023 and 2024, with broader RSU programs and performance metrics for stock options. Executives and management receive substantial portions of compensation in stock options and RSUs, promoting long-term commitment and performance. [Source: Alcoa Annual Reports 2022-2024, p. 45]

In 2022, Alcoa enhanced its healthcare benefits with expanded mental health support and telemedicine services. By 2023, the company continued to focus on employee wellness with additional preventive care options and wellness initiatives. In 2024, Alcoa's strategy remained centered on integrating innovative health solutions and maintaining comprehensive healthcare coverage. The company emphasized digital health tools and employee support programs to address evolving needs. Alcoa aimed to ensure robust healthcare benefits while managing costs effectively. Their approach reflects a commitment to improving overall employee well-being and satisfaction.

Additional Articles

Check Out Articles for Alcoa employees

For more information you can reach the plan administrator for Alcoa at 390 park avenue New York, NY 10022-4608; or by calling them at (412) 315-2900.

https://contracts.justia.com/companies/alcoa-corp-5547/contract/224382/ https://corporate.findlaw.com/contracts/compensation/amendment-to-deferred-compensation-plan-alcoa2.html https://cache.hacontent.com/ybr/R516/16557_ybr_ybrfndt/downloads/PriorAlcoaSalariedAFN.pdf - Page 23 https://cache.hacontent.com/ybr/R516/16557_ybr_ybrfndt/downloads/PlanIIC.pdf - Page 15 https://www.cityofalcoa-tn.gov/DocumentCenter/View/1511/2023-Benefits-Guide?bidId= - Page 30 https://cache.hacontent.com/ybr/R515/16557_ybr_ybrfndt/downloads/11AlcoaSavingsPlan.pdf - Page 42 https://s29.q4cdn.com/844074237/files/doc_news/2022/07/20220808_PensionAnnuity-VFinal.pdf - Page 8 https://www.alcoa.com/global/en/pdf/sustainability/policies-benefits.pdf - Page 5 https://www.alcoa.com/global/en/pdf/corporate-governance/2023-proxy.pdf - Page 10 https://www.alcoa.com/global/en/pdf/2022-annual-report.pdf - Page 50 https://www.alcoa.com/global/en/pdf/employee-handbook-2024.pdf - Page 35 https://www.alcoa.com/global/en/pdf/benefits-summary-2023.pdf - Page 18