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3: Analyze Your Decisions

What Will Health Care Cost You in Retirement?

stethoscope and money

Unlike your working years where you may have been covered by an employer’s health care plan, your health needs will become one of your largest spending components during retirement. A study by Fidelity* estimates health care costs of $260,000 during retirement for a 65-year-old couple retiring in 2016. This doesn’t include costs for long-term care.

Of course, your own life expectancy and medical needs will impact your actual costs. That is why it’s important to estimate your costs while you’re still working.

*Fidelity Investments


Estimating Your Health Costs in Retirement

Use these calculators to get a reasonable estimate of your health care needs:

  1. Estimate your life expectancy using the Social Security Administration’s Life Expectancy calculator. (Note, this calculator does not take your lifestyle into account, so this is a very tentative estimation.)
  2. Use that number and complete the information in AARP’s Health Care Costs calculator.

Keep in mind, these are simply estimates based on very general information about you and your medical conditions. But it will give you an idea of what Medicare will cover and the savings you will need to cover the rest of your health expenses.

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