Expert advice to help plan for retirement healthcare costs

Average 65-year-old retired couple needs about $315k in after-tax savings
Published: Apr. 6, 2023 at 3:03 PM EDT
Email This Link
Share on Pinterest
Share on LinkedIn

InvestigateTV - Experts from Fidelity estimate an average 65-year-old retired couple in 2022 would need about $315,000 in after-tax savings earmarked for health care costs, even when covered by Medicare.

Saving such a large amount may sound like a difficult task, which is why financial experts at NerdWallet created a list of strategies to help the average American prepare.

Take advantage of an HSA: A health savings account allows you to put pretax money away for medical expenses. To use an HSA, you must have a high-deductible health plan.

Plan for long-term care: A person turning 65 today has about a 70% chance of needing long-term care at some point, according to the Department of Health and Human Services. As you plan, ask yourself how long you intend to stay in your home and where you might go when you can’t live there anymore.

NerdWallet suggested looking into a traditional long-term care insurance policy, which can cost thousands of dollars per year, according to the American Association for Long-Term Care Insurance.

You could also set money aside annually for long-term care expenses.

Get the right Medicare plan: Find one that includes your preferred doctors and your regular medications, which will help you avoid high out-of-network and out-of-pocket costs.

Also always ask questions of doctors and insurance companies and make sure you know what’s covered. Same goes for prescriptions, get in the habit of asking if there’s a less expensive option of your prescribed medications.