Health Insurance & Medicare
The cost of medical coverage, both before and during retirement, is substantial. Discuss your options and lifestyle with your Wealth Alliance Advisor to help ensure that you are adequately planning for the cost of medical care.
Healthcare Costs in Retirement
American workers are split about 50/50 when asked if they are confident they will have enough money to pay for medical expenses in retirement.
In a 2016 survey, 45% of all workers reported they were “not too” or “not at all” confident they would have enough money to pay for their medical expenses in retirement. Fifty-four percent said they were “very” or “somewhat” confident they could pay the cost.Employee Benefit Research Institute, 2016 Retirement Confidence Survey
Regardless of whether you’re confident or not, it’s important to have an idea about how much healthcare may cost in retirement. By putting the costs in better perspective, you might be able to better understand what you can pay for and what you can’t.
Medicare beneficiaries spent an average of $4,734 out of pocket on health care in 2010, the most recent year for which figures are available. Forty-two percent of that went to premiums, 20% to long-term care facilities.
Source: MedicareResources.org, November 23, 2016
The Health-Care Breakdown
A retired household faces three types of health-care expenses.
2. The household should expect to pay for co-payments related to Medicare-covered services that are not paid by Medigap or other health insurance.
3. The retired household should expect to pay for dental care, eyeglasses, and hearing aids, which are typically not covered by Medicare or other insurance programs.
Healthcare Adds Up
For a healthy 55-year-old couple who plans to retire in a decade, the number jumps to $466,000.HealthView Services: 2016 Retirement Health Care Costs Data Report (Costs shown are in current dollars.
Should you expect to pay this amount? Possibly. Seeing the results of one study may help you make some critical decisions when creating a strategy for retirement. Without a solid approach, health-care expenses may add up quickly and alter your retirement spending.
Fast Fact: Nursing Home Costs
In 2016, the national average rate for a private room in a nursing home was $92,376 a year. The national average rate for a semi-private room in a nursing home was $82,128.
Source: Genworth 2017 Cost of Care Survey
Out-of-Pocket Healthcare Cost
The cost of healthcare for a 65-year-old couple is projected to increase with age.
Source: HealthView Services: 2016 Retirement Health Care Costs Data Report (Costs shown are in future dollars.)