Rising medical expenses are weighing heavily on Americans’ minds, but many still are not building those costs into their retirement plans, according to new survey findings from D.A. Davidson.
Nearly four-fifths of respondents (78%) said they were concerned about how rising healthcare costs could affect their retirement. Yet just around half (48%) reported that they have explicitly accounted for higher healthcare expenses in their retirement planning, and only one-sixth (16%) said they feel very knowledgeable about what they are likely to pay for healthcare in retirement.
Those anxieties are playing out against a backdrop of steadily climbing estimates. Based on the latest projections from Fidelity, lifetime healthcare expenses for a couple retiring at age 65 in 2025 at an average of $345,000, up nearly 41% from $245,000 in 2015.
“Healthcare is one of the most significant, and yet still underestimated, expenses that most retirees will face,” Andrew Crowell, financial advisor and vice chairman of wealth management at D.A. Davidson, said in a statement unveiling the findings. “Healthcare inflation typically runs at least twice the rate of overall inflation, yet many people experience denial over the fact that this could impact their retirement strategy one day.”
If healthcare costs end up higher than anticipated, the survey suggests many households would be forced into difficult trade-offs. Thirty-seven percent of Americans said they would cut back on everyday spending, while 34% would scale back travel or leisure. Sixty percent said they have already seen someone in their life struggle with healthcare costs in retirement, underscoring how visible the risk has become.
“Unexpected medical expenses can derail even well-structured retirement strategies, but the good news is that proactive planning can help pre- and current retirees better protect their financial security,” Crowell said.
The research also highlights a missed opportunity around health savings accounts. Just 21% of Americans reported having an HSA, a tax-advantaged account available to those with high-deductible health plans. Among those who do have an HSA, only 40% said they are using it as a long-term savings vehicle for future healthcare costs rather than simply a pass-through for current expenses.
“HSAs are one of the most powerful tools we have available for retirement planning,” Crowell said, pointing to their triple tax advantage as a way to help cover healthcare costs later in life.
A data snapshot from Devenir found total assets in HSAs reached $159 billion by the first half of 2025 as investment assets within such accounts jumped 30% over the previous year.
When asked how they expect to pay for healthcare costs in retirement, 47% of participants in D.A. Davidson's survey pointed to Medicare Advantage or supplemental Medicare coverage, 35% cited retirement accounts such as 401(k)s or IRAs, and 34% said they would rely on personal savings outside retirement plans. Seventeen percent mentioned long-term care insurance, 13% named HSAs, and another 17% said they would use none of those options.
Despite the rising concern, only 23% of Americans have ever discussed retirement healthcare costs with a financial advisor, the survey found. Respondents were just as likely to lean on friends and family as on government or Medicare resources, at 20% each, and 23% said they primarily get information from articles or social media.
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