For retirees, January is supposed to be a month of celebration. The annual Cost-of-Living Adjustment (COLA) hits bank accounts, promising a little extra breathing room. In 2026, that bump was a modest 2.8%—better than some years, but hardly a windfall. Unfortunately, for millions of seniors, that raise was spent before it even arrived.
While the “headline” inflation rate has cooled, the specific basket of goods and services that seniors rely on has seen steep price hikes at the start of 2026. From the mandatory deduction for Medicare to the rising cost of staying in your own home, the “senior inflation rate” is running hotter than the national average. If your budget feels tighter this month despite the higher deposit from Social Security, this is where the money is going. Here are seven fixed-income expenses that just jumped again.
1. The Medicare Part B Premium
The most direct hit to a senior’s wallet is the one they never see because it is deducted automatically. For 2026, the standard monthly premium for Medicare Part B has risen to approximately $202.90, an increase of nearly $18 from the previous year.
This represents a roughly 9.6% increase, far outpacing the 2.8% Social Security COLA. For a retiree receiving an average benefit, this single line item can absorb nearly a third of their entire annual raise. Furthermore, the annual Part B deductible has also ticked up to roughly $283, meaning you will pay more out-of-pocket for your first few doctor visits this year before coverage kicks in.
2. Property Taxes (The “Commercial Shift”)
If you own your home, you may have noticed a sharp increase in your 2026 assessment. Across the country, cities are facing a “doom loop” in commercial real estate, with office building values plummeting due to remote work. To make up for this lost tax revenue, municipalities are shifting the tax burden to residential homeowners.
In cities like Boston, residential property tax bills have seen double-digit percentage increases for 2026 as the city rebalances its ledger. Even if your home’s value didn’t skyrocket this year, your tax rate likely did to subsidize the empty office towers downtown. For seniors on fixed incomes, this is a non-negotiable cost that threatens their ability to “age in place.”
3. Assisted Living and Home Care
For those requiring daily assistance, 2026 has brought another round of steep hikes. The median cost of a private room in an assisted living facility has climbed to over $6,300 per month in many markets.
The driver here is labor. The shortage of home health aides and nursing staff has forced agencies to raise wages significantly to attract workers. These costs are passed directly to residents. If you are paying out-of-pocket for home care, expect your hourly rate to have jumped by $2 to $3 an hour starting January 1st.
4. Auto Insurance for “Mature” Drivers
Auto insurance rates have risen for everyone, but seniors are seeing a specific “age-based” creep. In 2026, insurers are aggressively re-pricing risk based on vehicle technology and accident severity. Because modern cars are expensive to repair (due to sensors and cameras), a minor fender bender now costs thousands.
Seniors are seeing premium hikes of 20% or more at renewal, even with a clean driving record. Insurers are also tightening rules in states like California and Florida, forcing some retirees onto state-run “insurer of last resort” plans that offer worse coverage for more money.
5. HOA Fees and “Reserve” Assessments
If you live in a condo or a 55+ community, your monthly HOA fee likely jumped on January 1st. Following structural safety laws passed in states like Florida and New Jersey, associations are now legally required to fully fund their “reserves” for structural repairs.
This means the days of keeping fees artificially low are over. Many seniors are facing special assessments of $5,000 to $10,000 this year, or monthly dues increasing by $200, to catch up on decades of deferred maintenance. This “safety tax” is mandatory and can lead to foreclosure if unpaid.
6. Shipping and Parcel Rates
While the price of a standard stamp held steady in January, the cost of sending packages did not. The USPS raised rates on its “Ground Advantage” and “Priority Mail” services by roughly 6% to 7% to start the year.
For seniors who rely on shipping gifts to grandchildren or returning online purchases, these costs add up. Private carriers like UPS and FedEx also implemented “demand surcharges” for rural zip codes, making it more expensive to stay connected with family through the mail.
7. Utility “Grid” Charges
Finally, the cost of keeping the lights on has risen, but not always because of the electricity itself. Utilities have added new “fixed charges” to bills in 2026 to pay for grid modernization and wildfire protection.
These are flat fees that appear before you use a single kilowatt. In some states, the “customer charge” has doubled from $10 to $20 per month. This structure disproportionately hurts frugal seniors who try to save money by using less power; you cannot conserve your way out of a fixed fee.
Re-Calculate Your Budget
If you are operating on a 2025 budget in 2026, you are likely already in the red. Take an hour this week to update your ledger with these new, higher fixed costs. You may need to adjust your discretionary spending to account for the fact that your “overhead” just got more expensive.
Did your Part B premium eat up your entire COLA raise? Leave a comment below—share your math!
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