Retirement Social Security

6 Things People Are Giving Up in Retirement Because of Social Security Cuts

Shrinking Social Security checks are reshaping retiree life.

By Josh Koebert , Edited by Laura Hohenstein

Updated June 3, 2026

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The 2026 Social Security cost-of-living adjustment (COLA) is 2.8%, which caused the average senior benefits check to increase by $56. While this bump from $2,015 to $2,071 was a welcome change for seniors, it didn't cover much after accounting for the $17.90 increase in Medicare Part B premiums.

How have retirees put what's left over, approximately $38, to use? We can't see what's going on in every household, but data from the Nationwide Retirement Institute gives us some clues.

Here's what we see seniors spending less on as the costs of essentials rise higher than the COLA adjustments can account for.

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The big picture on senior spending

The NRI survey zooms out on a nationwide concern: more retirees are changing how they spend and save. The percentage of seniors by cost-saving activity includes:

Cutting back on discretionary spending (52%)
Reducing essentials like groceries and medications (31%)
Downsizing their living situation (18%)
Turning to part-time work or extra income-earning activities (15%)

Within these categories, seniors are making some very personal decisions, often choosing between two important, competing priorities needed to preserve their standard of living. This list of specific spending buckets gives more insight into the reality they face, and things to consider in your own retirement.

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Travel and vacations

Many people dream of seeing new places and visiting faraway loved ones when they retire, but the budget math may not add up. Considered part of discretionary spending and not essential to survive, travel is often one of the first things to get cut, as it's easier to skip a family vacation than an electric bill.

It's not just the price of a plane ticket that needs to be considered; seniors may cut back on travel due to rising fuel, hotel, and travel insurance costs. It's an understandable choice considering that a $38 net COLA increase may need to go to other things. If seniors do travel, they may look to off-season, shorter, or closer-to-home getaway trips to balance their wanderlust with budget realities.

Dining out and social events

With more than half of seniors cutting out non-essential spending, dinners with friends may be among the first to go. Even a simple meal at a senior discount comes with added costs, including tip, entertainment tax (in some cities), and even takeaway fees for those who want to take their dinner to go.

The Consumer Price Index explains the food-at-home (2.9%) versus food-away-from-home (3.6%) increases quite well. Sadly, these social outings aren't just about treating themselves; seniors rely on lunches out, coffee meetups, and the occasional brunch to reconnect and fight loneliness.

Potlucks and other cost-saving measures may become more common as they work to balance these needs.

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Gifts and help for grandkids

It's fun for grandma and grandpa to treat the youngest generation, whether it's a birthday card with cash, school clothes, or a contribution to a 529 college savings plan. But these things are still considered extras and part of the discretionary budget. So, when forced to choose between meeting rising living costs or helping their grown kids with their kids, seniors may have to pick the former.

Missing even half of a Social Security payment would leave 61% of current benefit recipients unable to survive financially, so there's often little cushion to be as generous as they would like to be. Instead of material goods, retirees may look to more quality time doing free activities with their grandkids, which can also be meaningful but not as expensive.

Prescription medications

Prescription drugs are considered essential, but that doesn't mean seniors have the funds to pay for them in every instance. Remember the stats showing 31% have reduced essential spending? That number may very well include medicines seniors need to stay healthy.

It's not advised that patients skip refills, split pills, or opt for cheaper but less effective alternatives. Some may feel they have no choice, however, as out-of-pocket medical costs take more of their Social Security check. One Center for Retirement Research (CRR) analysis estimates that health care expenses take all but 71% of monthly benefits for those who can even spend that much.

Home maintenance and repairs

Deferring home maintenance can make a home less safe and more expensive to repair over time. If a senior isn't sure how they will pay for property taxes, homeowners' insurance, utilities, and other essentials, however, they may not see a roof repair or HVAC upgrade as even a possibility.

This is when we see seniors "kicking the can" or putting services off until there's more room in the budget. But what if that day never comes? And what if the home becomes harder to live in as a result?

Seniors stuck figuring things out may turn to local repair grants, state weatherization programs, or budgeting a small monthly "maintenance sinking fund" if possible.

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Home mortgage or rent

Downsizing may look like many different things. For one senior, it could be selling a large family home to move into a smaller condo with maintenance included. For another, it could be a transition into rental or even moving in with an adult child or other relative.

All of these situations come with benefits, such as reduced housing costs and (in some cases) companionship and support through older age. But all can cause emotional stress, moving expenses, and — in the case of moving far away — loss of community connections.

Some retirees see the writing on the wall with their Social Security and make these changes proactively, citing the need for care from relatives and a lower housing budget as win-wins that are best handled on their own terms.

Bottom line

All of these realities around COLA and living expenses may seem like an issue on their own. But there's another concern that the Old-Age and Survivors Insurance (OASI) Trust Fund is expected to be exhausted around 2032 if Congress fails to come up with a solution.

In this scenario, the ongoing incoming payroll tax won't cover more than 77% of scheduled benefits, so a cut may be required for some beneficiaries. Estimates show an additional $150,000 in retirement savings would be needed to fill in the gap.

You don't have to wait for legislative action if retirement savings are stretched thin. A quick refresh of the budget is always a good idea, along with honest talks with loved ones about the options, should you need help coordinating housing or care.

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