President Donald Trump won a second term in the White House partly because of his promises to bring consumer prices down from the historic highs they hit during the Biden administration.
Those promises likely sounded pretty good to retirees who have found it increasingly difficult to make ends meet. But so far, prices continue to rise across just about every spending category under the Trump administration.
Overall inflation rose 3.2% year-over-year in November, according to the latest data from the U.S. Bureau of Labor Statistics. Among the categories that saw even bigger increases than that were food, electricity and medical care services — each of which eat up a big part of retirees’ budgets every month.
Here are three ways the Trump administration might increase the cost of retirement in the next three years.
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Tariffs & Consumer Prices
Tariffs on imported goods are a key part of Trump’s economic agenda — and also a key driver of inflation in 2025.
As of late October, tariffs raised overall retail prices by about 4.9 percentage points relative to the pre-tariff trend, according to a recent analysis from the Tax Foundation, a nonpartisan tax policy nonprofit.
If the Trump administration sticks to its tariff policies, prices could rise even higher in coming years after current supplier contracts expire.
This problem is not unique to older Americans. However, it could have an outsized impact on retirees because many live on fixed incomes that don’t allow much wiggle room for rising costs, according to Chad Cummings, an attorney and certified public accountant (CPA) at Cummings & Cummings Law who previously worked in finance and tax.
“For those on a fixed income, tariff-driven inflationary pressures can easily add $2,500 in food costs yearly to a $24,000 budget,” Cummings told GOBankingRates. “Our clients are also seeing this in home repairs where remodels and renovations are now being quoted at roughly double the expense compared to Trump’s first term.”
Tariffs & Healthcare
Tariffs don’t only contribute to higher prices on consumer goods — they also raise the cost of healthcare. This is problematic for retirees because healthcare is such a major expense.
“First, Trump’s tariffs on imported pharmaceuticals and medical devices will drive up healthcare premiums by at least 10%-15% in 2026, erasing the benefit of the 2.8% Social Security cost-of-living adjustment for retirees,” Cummings said.
Because of the prospect of higher drug prices, he advises his clients to “consider stockpiling prescriptions” now if they can afford to. He also advises that they “aggressively” explore Medicare Advantage plans, but offers a word of caution.
“These plans often deny claims in ways that trap you in endless appeals, potentially costing thousands in uncovered care,” Cummings said.
Medicare Costs
Speaking of Medicare: Retirees will face higher costs for the healthcare program in 2026, which is what usually happens when overall inflation rises.
Here are some of the higher Medicare costs that will kick in in 2026, according to the Centers for Medicare & Medicaid Services:
- Medicare Part A inpatient hospital deductible: This deductible will rise to $1,736 in 2026 from $1,676 in 2025.
- Medicare Part B monthly premium: The standard premium will be $202.90 in 2026, an increase of $17.90 from 2025.
- Part B annual deductible: This deductible will increase by $26 in 2026 to $283.
- Part D and Medicare Advantage: While the projected average Part D premium will be slightly lower, the annual out-of-pocket costs will increase from $2,000 to $2,100.
- Other costs: Some beneficiaries could face higher out-of-pocket expenses for services like coinsurance.
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This article originally appeared on GOBankingRates.com: 3 Ways the Trump Administration Can Increase Retirement Costs in the Next 3 Years
