Am I saving enough for health care in retirement?

Published by Taylor Financial Group

Q. Dear Debbie: Am I saving enough for health care in retirement?

A. This is a great question, and one that everyone should be asking themselves.  According to research performed by Nationwide Financial, health care will likely be the greatest expense for people in retirement.  Yet, 60% of people cannot estimate what their health care costs will be in their retirement, which is not surprising given all of the variables, such as Medicare changes, the rising cost of health care, and the uncertainty surrounding the most recent version of the Health Care Act.  One thing we do know for sure is that the cost of healthcare is increasing faster than the rate of inflation — whether you like it or not.  So, figuring out whether you’re saving enough to account for these changes is a must, if you want to help ensure you don’t spend your retirement savings on health care expenses.

Though Medicare and other private health insurance will help pay for some health care expenses, a significant portion will still come out of your pocket.  In fact, the average 65-year-old couple spends about $250,000 (in today’s dollars) out of their own pocket for health care costs during a 20-year retirement, and that figure can go as high as $461,000.

One of the best ways to help close the gap and minimize your out-of-pocket health care expenses is to start planning and saving now.  But you have to start with an evaluation of your overall situation and your plans for the future, so that you have a point of reference and a starting point.  For this reason, we offer our clients various resources that can help estimate what their Medicare premiums, long-term care expenses, and out-of-pocket expenses might be in retirement.  We also monitor the changes in health care insurance and laws in order to advise clients how to adjust their savings along the way.

If you would like to review your financial plan and consider how you might need to adjust your savings to account for retirement health care expenses, contact us today.  We can help!


Nationwide, Health Care Webinar, June 2017
Nationwide, Medicare and Health Care Costs, July 2017
 This material is for general information only and is not intended to provide specific advice or recommendations for any individual. To determine what is appropriate for you, consult a qualified professional.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. Securities offered through Cetera Advisor Networks LLC, Member FINRA/SIPC. Investment advisory services offered through CWM, LLC, an SEC Registered Investment Advisor. Cetera Advisor Networks LLC is under separate ownership from any other named entity.

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