Here’s how much retiring in 2026 could cost you in health care expenses
BOSTON – Americans retiring at age 65 in 2026 can expect to spend an average of $185,500 on health care and medical expenses throughout retirement, according to Fidelity Investments’ 25th annual Retiree Health Care Cost Estimate.
By the numbers:
Despite the higher projected costs, Fidelity said Americans are feeling more optimistic about retirement overall. Company research found that 72% of respondents believe they will retire on their own terms, while nearly three-quarters said they have a plan in place to achieve their retirement goals.
- 45% for Medicare Parts B and D premiums.
- 48% for other medical expenses, including copayments, deductibles, coinsurance and services not covered by Medicare, such as many vision and hearing costs.
- 7% for out-of-pocket prescription drug expenses not covered by Medicare Part D.
“Financial planning for retirement is about more than reaching a savings target, especially as retirement itself continues to evolve,” said Shams Talib, head of Fidelity Workplace Consulting. “Whether Americans fully stop working, phase into their retirement, or pursue new ways to stay engaged, health care consistently remains one of the largest expenses they will face. Providing a benchmark to consider can help them plan with purpose and more confidence.”
Fidelity has published its annual health care cost estimate since 2002 as a planning benchmark for retirees. The estimate assumes an individual is enrolled in Original Medicare Parts A and B, along with Medicare Part D prescription drug coverage. It includes Medicare premiums, copayments, deductibles and other out-of-pocket medical and prescription drug costs throughout retirement, but does not include potential long-term care expenses.
Why you should care:
What you can do:
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Fidelity said understanding potential medical costs — including Medicare premiums, dental and vision expenses, over-the-counter medications and long-term care — can help Americans build a more comprehensive retirement income strategy.
Original source: https://www.livenowfox.com/money
