For retirees expecting a larger Social Security payment in 2026, there's some good news and a catch that may be disappointing. While it helps benefits keep pace with inflation, offering a little extra each month, but next year's payments have a big surprise waiting and not in a good way.
ALSO READ: 2026 Social Security raise may get a Trump bump — here’s how much extra you will pocket
The Medicare Trustees forecast that the monthly Part B premium will increase by $21.50 in 2026, a 11.6% increase, as reported by The Motley Fool. That's the largest dollar increase since 2022, according to the report. For the average retiree above 65 years with Social Security benefits, this increase could cancel out approximately 39.7% of their projected COLA, as per The Motley Fool.
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In short, almost 40% of the $54.18 monthly bump could be wiped out by increased Medicare premiums, which might be a shock to many who weren't anticipating such a big increase in healthcare expenses, according to the report.
However, there are a few ways to prevent much of the 2026 Social Security COLA from being erased by higher Medicare Part B premiums, as suggested by The Motley Fool:
One alternative is to look into changing from traditional Medicare to an Advantage plan. While the base Part B premium remains, certain Advantage plans may provide cost savings elsewhere, including reduced deductibles and out-of-pocket maximums.
Retirees with limited incomes can also be eligible for assistance through Medicare Savings Programs. These state and federal programs can cover Part B premiums, deductibles, and coinsurance, as per The Motley Fool.
For those with more income, other Medicare surcharges called income-related monthly adjustment amounts (IRMAAs) may also raise premiums, as per The Motley Fool report. These are calculated on two years ago's income, so reducing income now won't pay off for 2026. But if a retiree had a significant life change, such as a job loss, getting married, a divorce, or the passing of a spouse, they can ask the Social Security Administration to reduce their IRMAA.
Switching to a Medicare Advantage plan, as per The Motley Fool report.
What is the expected Social Security COLA for 2026?
It’s likely to be about 2.7%, which would add roughly $54 to the average monthly benefit, as per The Motley Fool report.
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What Is the 2026 Social Security COLA Estimate?
The Social Security benefit cost-of-living adjustment (COLA) is likely to rise by 2.7% next year, based on an estimate from the nonprofit advocacy group Senior Citizens League (TSCL), as per a report. While the actual figure won't be made public until mid-October, once September's inflation figures are out, this estimate provides a fairly good indication of what retirees should expect, as per The Motley Fool.ALSO READ: 2026 Social Security raise may get a Trump bump — here’s how much extra you will pocket
How Much Will the Average Social Security Benefit Increase?
With the July 2025 average monthly Social Security payment standing at $2,006.69, a 2.7% COLA would translate into an increase of around $54.18 a month, as reported by The Motley Fool. However, there's a good chance many retirees won't get to see that money in their pockets, according to the report.Why Might Retirees Not See the Full COLA Boost?
Here's why: Medicare Part B premiums will rise, too, and the hike may cut deep into the COLA, as per The Motley Fool.The Medicare Trustees forecast that the monthly Part B premium will increase by $21.50 in 2026, a 11.6% increase, as reported by The Motley Fool. That's the largest dollar increase since 2022, according to the report. For the average retiree above 65 years with Social Security benefits, this increase could cancel out approximately 39.7% of their projected COLA, as per The Motley Fool.
ALSO READ: Job growth shocker: 911,000 jobs wiped from records — US economy worse off than you think
In short, almost 40% of the $54.18 monthly bump could be wiped out by increased Medicare premiums, which might be a shock to many who weren't anticipating such a big increase in healthcare expenses, according to the report.
Ways to Protect Your 2026 Social Security Increase from Rising Medicare Part B Premiums
However, there are a few ways to prevent much of the 2026 Social Security COLA from being erased by higher Medicare Part B premiums, as suggested by The Motley Fool:
One alternative is to look into changing from traditional Medicare to an Advantage plan. While the base Part B premium remains, certain Advantage plans may provide cost savings elsewhere, including reduced deductibles and out-of-pocket maximums.
Retirees with limited incomes can also be eligible for assistance through Medicare Savings Programs. These state and federal programs can cover Part B premiums, deductibles, and coinsurance, as per The Motley Fool.
For those with more income, other Medicare surcharges called income-related monthly adjustment amounts (IRMAAs) may also raise premiums, as per The Motley Fool report. These are calculated on two years ago's income, so reducing income now won't pay off for 2026. But if a retiree had a significant life change, such as a job loss, getting married, a divorce, or the passing of a spouse, they can ask the Social Security Administration to reduce their IRMAA.
FAQs
What can I do if I want to reduce my Medicare costs?Switching to a Medicare Advantage plan, as per The Motley Fool report.
What is the expected Social Security COLA for 2026?
It’s likely to be about 2.7%, which would add roughly $54 to the average monthly benefit, as per The Motley Fool report.
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