• Editorial 


    San Francisco, CA

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  • Out of pocket health insurance costs in retirement are staggering. The estimated averages vary -- but all are higher than most retirees have saved for.

    Research from Fidelity Investments says:
    A 65-year-old couple retiring in 2012 is estimated to need $240,000 to pay for medical costs throughout retirement. This estimate is up 4 percent from the 2011 estimate of $230,000, but still below the 2010 estimate of $250,000.

    Other analysis shows that:
    Average out-of-pocket health care spending by Medicare beneficiaries is sizable and increases with age.
    -- On average, Medicare beneficiaries aged 65-74 spend $2920 a year in out-of-pocket expenses.
    -- Those aged 75-84 spend $3,815, a year.
    -- And, those 85 and above spend $4,615 a year – an average of 30 percent of their income.

    Research from the Center for Retirement Research at Boston College indicates that:
    A typical 65-year-old married couple will need $197,000 to pay for medical costs throughout retirement including insurance premiums, out-of-pocket costs, and home health care expenses.

    ----> That figure doesn’t even include nursing home care. When potential long-term care costs are factored in, the figure a typical couple may be responsible for increases to $260,000, with a 5 percent chance of exceeding $570,000, according to the study, which was underwritten by Prudential.

    What can you do?

    Be sure you always have the best Medicare Supplemental coverage at the lowest cost, shop for insurance during eligibility periods. You can get instant quotes here:

    Consider having a plan for paying for long term care coverage.

    Shop for long term care insurers here:

    Or, you might consider buying a deferred lifetime annuity that could fund long term care for you in the future. Compare annuity quotes here:

  • Login to rate this answer:   Answered on 6/8/2012
**All above answers are provided as general information only. No warranty is made regarding the fitness or accuracy of the information provided in this answer. You should seek advice from a licensed CPA, attorney or CERTIFIED FINANCIAL PLANNER™ as to your unique financial situation.