Health Care Costs Are a Major Retirement Expense
You may need to pay premiums for
health care insurance coverage
before you become eligible for
Medicare. Once you become eligible,
Medicare premiums (which pay for
some of the cost of doctor visits)
typically range from $96.40 to $110.50
a month for most people; higher for
upper-income individuals.* Plus there
are the costs of Medicare supplement
plans, prescription drug plans and
uncovered expenses.
According to the Employee Benefit
Research Institute, a man retiring
at age 65 with unsubsidized retiree
health benefits may need $217,000
in savings to have a 90% chance of
having enough to cover health costs
during retirement. A woman retiring
at age 65 with unsubsidized retiree
health benefits may need $266,000.**
These are just estimates and will
depend on an individual’s health
and longevity.
These estimates do not include the
cost of long-term care, should you
need it.
* Medicare Part B premiums for 2010.
** Source: Employee Benefit Research Institute, June
2009, Vol. 30, No. 6, www.ebri.org. Savings needed for
employment-based health premiums, Medicare Part B
premiums and out-of-pocket costs during retirement.
