Cameron Zabko, CFP®
For many widows, Social Security benefits serve as an important source of income just as day-to-day expenses often feel higher than ever. That’s why the upcoming 2026 Social Security Cost-of-Living Adjustment (COLA) is on the minds of those looking to preserve—and possibly stretch—their monthly finances. Early projections suggest this COLA could raise the average benefit by around $54 per month, offering hope of some extra breathing room. Yet rising healthcare costs, especially Medicare premiums, threaten to shrink that increase before it can make any real difference.
This dynamic is even more pressing for women navigating life on a single income. When you lose a spouse, not only do you grapple with grief, but your finances often require an entirely different game plan. The bump from Social Security may seem like a silver lining, but it can be outweighed by Medicare premium hikes, expiring health subsidies, and added out-of-pocket costs that come with aging—facts especially relevant to widows eager to secure their finances for the future.
Social Security’s annual COLA is tied to inflation trends, aiming to keep up with rising living costs. In some years—like 2022 and 2023—the COLA was relatively high due to inflation spikes. Current estimates for 2026 suggest a rate in the 2.7% to 3.5% range, which translates into an average of about $54 more per month for beneficiaries.
Unfortunately, it’s not unusual for budgets to be squeezed the moment these COLA increases take effect. For many widows, Social Security is more than just a monthly check—it’s a lifeline. And when you’re forecasting how those extra few dollars each month might help with challenges like travel costs or mortgage payments, you’ll also need to consider the rising Medicare premiums that get deducted before you ever see your net benefit.
Medicare is a welcome safety net for older Americans, but it’s no secret that premiums and deductibles escalate nearly every year. In 2026, Medicare Part B premiums are projected to jump to about $206.50 per month. It’s a sobering reminder that while the COLA puts money in your pocket, Medicare often takes it right back out.
Then there’s Part D, the prescription drug plan that many widows rely on for important medications. Part D premiums are expected to rise too, though the exact numbers vary. For those receiving an average Social Security benefit, the COLA might barely cover the added cost of prescriptions, especially if you factor in deductible increases and potentially higher drug prices. For women who outlive their spouses by several years, consistently climbing healthcare costs can make the future feel daunting—especially when you’re striving to maintain your independence and the lifestyle you worked decades to build.
Beyond Medicare premiums, certain policy changes on the horizon could tighten your budget still further. Widows under age 65 who aren’t yet eligible for Medicare might be using marketplace health insurance. But enhanced Affordable Care Act (ACA) subsidies are set to expire at the end of 2025, meaning that in 2026, some premiums could rise by as much as 75%.
That can be a crushing blow for those already juggling everyday bills on a single, reduced income. Even if your Social Security survivor benefits carry you past age 65, changes to Medicare Savings Programs or Medicaid could make a difference. Several proposals would cut back on premium assistance for enrollees who are qualified but not quite low-income, leaving many widows in a gap where they earn “too much” to qualify for help but don’t earn enough to comfortably cover huge premium increases. Coupled with the typical rise in Medicare costs, this landscape can feel like uncharted territory.
Living on your own after decades of shared income can be disorienting. It’s not just about smaller checks—there’s also the emotional weight of ensuring your spouse’s legacy is well looked after. According to various studies, more than half of widows live on less than $22,000 per year, so even modest price hikes have outsized consequences.
One particular challenge is that healthcare expenses usually climb with age—and women, on average, live longer than men. Tugging at an already stressed budget are the higher likelihood of chronic conditions and a greater need for long-term care, which can cost $75,000 or more annually. While Social Security is designed to stabilize part of your income as you age, its increases do not always keep pace with the realities of modern healthcare expenses.
What can make the burden worse is that many newly widowed individuals might qualify for government programs or cost-saving measures but fail to take advantage of them—either because they’re unaware or because the enrollment process becomes too overwhelming. Whether you’re confronting probate details or following a step-by-step checklist for closing your late spouse’s bank accounts and credit cards, navigating bureaucratic forms can fall to the bottom of your to-do list when you’re adjusting to a single income.
There’s no magical formula that stops living costs from rising. But understanding how it all fits together can offer a sense of control and clarity, which are invaluable—to your peace of mind and your bank account. Below are some practical insights widows might consider when budgeting for 2026 and beyond:
Prioritize your net income. When you receive your Social Security statement, it’s easy to focus on the gross monthly benefit. But your net benefit—what actually lands in your checking account after Medicare premiums and any tax withholdings—often tells a more accurate story. Knowing exactly what you can count on each month helps you set a more realistic budget.
Factor in healthcare inflation. Medicare Part B and Part D premiums tend to rise faster than general inflation. Planning for out-of-pocket costs, whether prescription drugs or potential nursing-home care, can help you avoid tapping retirement savings prematurely. Building a cushion for health-related expenses in your annual budget may make future spikes in premiums or co-pays more manageable.
Review your coverage options each year. Keep an eye on alternative Medicare plans or Medicare Advantage options, which sometimes offer lower premiums—though you’ll want to weigh the trade-offs, such as network constraints or higher deductibles. If you find this process complicated, ask a professional or a knowledgeable family member or friend to walk through the annual enrollment details with you.
Keep a watchful eye on policy changes. From Capitol Hill chatter about changing how the COLA is calculated to the possible end of certain ACA provisions, these shifts can materially impact your finances. Adapting quickly—by revising your monthly or annual budget—puts you in a better position than being caught off guard.
Most of all, don’t tackle this alone if you find it overly complex. Having a confidant, whether that’s a family member familiar with accounting or a trusted financial advisor, can be a critical part of helping you avoid missing out on possible benefits or miscalculating your monthly cash flow.
Because widowhood comes with both emotional and financial obstacles, seeking specialized guidance can be an important step. That’s precisely why we invite you to schedule an intro call with Westhollow Wealth Management. We’ve helped countless widows navigate these pivotal transitions, walking them through strategies on everything from Social Security timing to establishing an emergency fund specifically for healthcare surprises.
Our approach is straightforward: we meticulously examine your unique situation and assemble a plan that supports your vision for the next chapter. You can learn more about what we do at Westhollow Wealth Management; it’s not just about charts and numbers—it’s about helping you feel confident traveling with grandchildren, covering future medical needs, or simply enjoying the peace that comes from knowing your money is managed with your best interests in mind.
Why is the 2026 Social Security COLA expected to be lower than previous surges?
Inflation trended much higher in 2022–2023, causing a large COLA in those years. More recent indicators point toward slightly moderating inflation, so experts project a COLA in the 2.7% to 3.5% range for 2026—still helpful, but not as high as the record surges.
Will Medicare Part B premiums always offset COLA increases?
Not necessarily, but healthcare costs often rise faster than general living expenses. In 2026, Part B premiums are set to increase by about $21.50, which will eat up a good portion of the average COLA. Each year can differ, but it’s common to see Medicare’s growth outpace inflation.
What if I’m under 65 and can’t yet enroll in Medicare?
You might still rely on marketplace coverage, which can be affected by expiring ACA subsidies. Some widows could face steep premium increases in 2026, so it’s wise to explore all options—including state-specific assistance or short-term eligibility expansions—before those subsidies end.
How can I prepare for long-term care expenses?
Budgeting beyond immediate medical costs is crucial, as any extended care—either at home or in a facility—can easily run into tens of thousands of dollars annually. Many families choose to integrate potential long-term care expenses into their broader retirement strategy, so understanding your resources and coverage options ahead of time can make a significant difference.
Ultimately, every widow’s situation is unique. The 2026 Social Security COLA could offer a modest boost in monthly income, but when paired with rising Medicare premiums and other policy shifts, much of the benefit can quickly vanish. At Westhollow Wealth Management, we believe that understanding the interplay of Social Security, medical expenses, and changing legislation is essential to helping you build a confident and lasting plan for the years ahead. If you’d like to take a deeper look at your personal numbers and craft a strategy designed just for you, consider scheduling an intro call today. We’re here to help you create a next chapter of your life that is filled with the clarity, stability, and peace of mind every widow deserves.
