In case you’re wondering how much of your retirement savings might go toward health care, Fidelity has a new number – and it’s going up.
According to Fidelity Investments’ annual Retiree Health Care Cost Estimate, a 65-year-old couple retiring in 2019 can expect to spend $285,000 in health care and medical expenses throughout retirement, up from $280,000 in 2018. For single retirees, the health care cost estimate is $150,000 for women and $135,000 for men.
While that’s an increase, and health care costs are a top financial concern in retirement, the past two years combined have seen a slower rise (3.6%) than in the previous two years (2015-2017), which saw the estimate rise from $245,000 to $275,000 (a total of 12.2%).
Fidelity’s estimate assumes both members of the couple are eligible for Medicare, which between Medicare Part A and Part B covers expenses such as hospital stays, care at a skilled nursing facility, doctor visits and services, physical therapy, lab tests and more. Fidelity notes that, at least for current retirees, out-of-pocket Medicare costs have leveled – meaning at least in the past year, medical costs have not increased at the rate experienced in previous years.
Some more good news? Fidelity maintains that a 35-year-old couple could accumulate $285,000 by the time they were 65 if they saved $2,820/year.
