AARP sends strong message on Social Security, Medicare in 2026

For many Americans, retirement is often imagined as a calm, predictable stage of life — but in reality, routines, financial priorities, and personal expectations continue to evolve long after they have finished full‑time work.

And with major adjustments on the horizon in 2026 — including changes to Medicare costs, Social Security benefits, and the way money is managed — this phase can feel disorienting, according to the advocacy group AARP.

"This dynamic new chapter comes with its own twists and turns," wrote the AARP. "Your lifestyle, expectations, and finances continue to change. And in 2026, big shifts are coming — from Social Security payments and Medicare expenses to how you save and spend."

Understanding what is changing is beneficial for both those already in retirement and those preparing for life after their careers.

AARP explains 2026 Social Security COLA increase

Social Security beneficiaries will see their payments rise by 2.8% in January 2026, when the new cost‑of‑living adjustment (COLA) takes effect, according to the AARP.

Based on estimates from the Social Security Administration (SSA), the typical monthly retirement check will go up by about $56, moving from $2,015 to $2,071.

Survivor benefits for widowed spouses are also increasing, with the average payment climbing from $1,867 to $1,919 — a $52 boost.

This adjustment for 2026 is tied to shifts in consumer prices measured between the third quarter of 2024 and the third quarter of 2025.

Related: AARP sends a strong message on inflation, Social Security

The U.S. Bureau of Labor Statistics' (BLS) Consumer Price Index (CPI) report, used to calculate COLA, showed that inflation edged higher during that period, which is why the upcoming increase is slightly larger than the 2.5% adjustment applied for 2025.

"People collecting retirement, family, survivor, or Social Security Disability Insurance (SSDI) benefits will see the COLA boost in their January payments," wrote Cameron Huddleston and Deirdre Shesgreen for AARP.

"The COLA’s impact on beneficiaries’ purchasing power will depend largely on inflation trends in 2026," the authors continued. "If inflation cools, the 2.8 percent benefit increase could provide retirees with a modest financial cushion."

"But if prices continue to climb, the COLA may leave beneficiaries struggling to manage their expenses."

AARP clarifies Medicare premium increase in 2026

Medicare Part B helps pay for doctor visits, outpatient hospital care, specific home health services, durable medical equipment, and a range of medical services that aren’t included under Medicare Part A (which covers inpatient hospital, skilled nursing facility, hospice, inpatient rehabilitation, and some home health care services), according to Medicare.gov.

The premiums, deductibles, and coinsurance amounts for Part B are updated annually, following the rules laid out in the Social Security Act.

"The standard monthly premium for Medicare Part B enrollees will be $202.90 for 2026, an increase of $17.90 from $185.00 in 2025," wrote the Centers for Medicare and Medicaid Services (CMS). "The annual deductible for all Medicare Part B beneficiaries will be $283 in 2026, an increase of $26 from the annual deductible of $257 in 2025."

More on personal finance:

• Dave Ramsey warns Americans on critical Medicare mistake to avoid
• Finance author sends strong message on housing costs
• Scott Galloway explains his views on retirement, Social Security

Other Medicare parts might be affected as well.

"People with Medicare Advantage (MA) coverage or Medicare Part D prescription drug plans may see varying costs, as these plans are provided by private insurers," wrote the AARP.

"According to Medicare estimates, the average monthly premium for an MA plan will decline by $2.40 a month, from $16.40 in 2025 to $14.00 in 2026," the advocacy group added.

"The average premium for a stand-alone Part D prescription plan is projected to be $34.50 next year, a reduction of $3.81 from 2025."

AARP outlines 2026 changes to 401(k)s, IRAs

• The Internal Revenue Service (IRS) updates yearly limits on how much individuals can contribute to IRAs and employer-sponsored retirement plans, with different tiers depending on age and account type, the AARP reported.
• For IRAs in the 2026 tax year, the general contribution limit is $7,500, an increase from $7,000 in 2025. The catch‑up contribution for people 50 and older rises from $1,000 to $1,100, allowing a total of up to $8,600 in 2026. Contributions for the 2025 tax year can still be made until April 15, 2026.
• For workplace retirement plans such as 401(k), 403(b), and the Thrift Savings Plan, the 2026 contribution limit for workers age 49 and under is $24,500, which is $1,000 higher than the 2025 limit.
• Workers ages 50–59 and those 64 and older have a catch‑up limit of $8,000 in 2026 (up from $7,500 in 2025), bringing their total possible contribution to $32,500.
• Workers ages 60–63 qualify for the “super catch‑up,” which remains $11,250 for 2026, allowing a maximum contribution of $35,750.

Related: AARP raises a red flag on Social Security, Medicare