New tab for retirement health care: $240,000

The cost of health care in retirement has risen 50% since 2002, according to research released today by Fidelity Investments.
MAR 26, 2009
By  Bloomberg
The cost of health care in retirement has risen 50% since 2002, according to research released today by Fidelity Investments. A 65-year-old couple retiring this year will need about $240,000 to cover medical expenses in retirement apart from Medicare insurance, reflecting a 6.7% increase over the 2008 estimate of $225,000, according to the Boston-based firm, The analysis assumes that the individuals do not have health care coverage provided by their employers, but they do quality for the federal Medicare insurance. Twenty-nine percent of that total represents premiums associated with Medicare Parts B and D; 41% for the cost-sharing provisions of Medicare, including co-payments, co-insurance and deductibles; and 30% for prescription drug out-of-pocket expenses such as co-pays. The estimate does not include other expenses such as over-the-counter medications, most dental services and long-term care. It is based on the assumption that the men will live to age 83 and the women to 86. “With employee-sponsored retiree health care coverage on the decline nationwide, it is imperative that today’s workers begin to set aside money themselves for medical expenses in retirement as part of their overall retirement strategy,” Brad Kimler, executive vice president of Fidelity’s Consulting Services business, said in a statement.

Latest News

Fintech bytes: Vestwell comes through for underserved savers with multilingual support
Fintech bytes: Vestwell comes through for underserved savers with multilingual support

MyVest and Vestmark have also unveiled strategic partnerships aimed at helping advisors and RIAs bring personalization to more clients.

UBS profit beats estimates as Ermotti sees brighter outlook
UBS profit beats estimates as Ermotti sees brighter outlook

Wealth management unit sees inflows of $23 billion.

Evercore to buy advisory firm Robey Warshaw for $196 million
Evercore to buy advisory firm Robey Warshaw for $196 million

Deal will give US investment bank a foothold in lucrative European market.

Gates and Buffett’s Giving Pledge is 15 years old, but many signatories are richer than ever
Gates and Buffett’s Giving Pledge is 15 years old, but many signatories are richer than ever

New report examines the impact that the initiative has had on philanthropy.

Americans stay the course on 401(k) savings despite inflation fears
Americans stay the course on 401(k) savings despite inflation fears

Few feel confident that they will meet their retirement goals.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.