Retirement Planning: Paying For Healthcare and Long-Term Care (2021)
- 3 years ago
When planning your retirement there's a lot to think about, from how much you need to save, when should you start taking social security, and what are you going to do with all your free time.
Yet all too often, retirees are surprised by one major expense they did not account for, healthcare.
Today we know that healthcare can be a major expense for retirees. In fact, the three largest expenses you will face in retirement are housing, transportation, and healthcare, so making sure you have planned for it is important.
Why does it catch so many off guard?
For starters, many assume that Medicare will cover all their healthcare costs. And while Medicare does provide for health care coverage in retirement, it does not cover everything.
Premiums, deductibles, copays, co-insurance are just some of the costs you will be responsible for.
Furthermore, if you want coverage for prescription drugs, vision and dental services, you will be required to purchase additional coverage. And don't forget Medicare doesn't cover it stays longer than 90 days in a skilled nursing facility.
So how much can you expect to spend on healthcare?
The amount you spend on healthcare will generally increase as you age.
Today, a healthy 65-year-old couple will spend about $12,052 a year in out-of-pocket healthcare expenses.
At 75, that will increase to $21,706.
And by age 85, it will jump $37,839, which is over three times what they spend at age 65.
Why a jump?
Imagine your retirement is having three distinct phases.
The first phase is what we call your go-go years. During this time, you are living life to the fullest. You're traveling, playing golf, spending time with your family and friends, doing all the things you look forward to doing in retirement.
During this phase, you tend to be healthy and living independently.
But as you age, you will enter the second phase of retirement called the slow-go years.
While you still might be able to do all of the things you were doing before, now it takes a little more energy to do them.
Driving might become a little more difficult, you are moving a little slower. Those aches and pains start to act up a little more requiring a few more doctor visits than before.
Finally, the third phase is the no-go years.
During this time, you may no longer be able to live independently, things such as cleaning your house and grocery shopping may require you to hire someone to help, or you may need support from a nurse or family member.
It is during this phase when healthcare costs really go up, The Annuity Expert has products and strategies to help you plan for these costs such as insurance products, commonly referred to as linked-benefit products.
These products combine life insurance with long-term care benefits, allowing you to access benefits, to pay for services such as skilled nursing, in-home care, and medical services.
Learn More: https://www.annuityexpertadvice.com/paying-healthcare-long-term-care-costs/
Yet all too often, retirees are surprised by one major expense they did not account for, healthcare.
Today we know that healthcare can be a major expense for retirees. In fact, the three largest expenses you will face in retirement are housing, transportation, and healthcare, so making sure you have planned for it is important.
Why does it catch so many off guard?
For starters, many assume that Medicare will cover all their healthcare costs. And while Medicare does provide for health care coverage in retirement, it does not cover everything.
Premiums, deductibles, copays, co-insurance are just some of the costs you will be responsible for.
Furthermore, if you want coverage for prescription drugs, vision and dental services, you will be required to purchase additional coverage. And don't forget Medicare doesn't cover it stays longer than 90 days in a skilled nursing facility.
So how much can you expect to spend on healthcare?
The amount you spend on healthcare will generally increase as you age.
Today, a healthy 65-year-old couple will spend about $12,052 a year in out-of-pocket healthcare expenses.
At 75, that will increase to $21,706.
And by age 85, it will jump $37,839, which is over three times what they spend at age 65.
Why a jump?
Imagine your retirement is having three distinct phases.
The first phase is what we call your go-go years. During this time, you are living life to the fullest. You're traveling, playing golf, spending time with your family and friends, doing all the things you look forward to doing in retirement.
During this phase, you tend to be healthy and living independently.
But as you age, you will enter the second phase of retirement called the slow-go years.
While you still might be able to do all of the things you were doing before, now it takes a little more energy to do them.
Driving might become a little more difficult, you are moving a little slower. Those aches and pains start to act up a little more requiring a few more doctor visits than before.
Finally, the third phase is the no-go years.
During this time, you may no longer be able to live independently, things such as cleaning your house and grocery shopping may require you to hire someone to help, or you may need support from a nurse or family member.
It is during this phase when healthcare costs really go up, The Annuity Expert has products and strategies to help you plan for these costs such as insurance products, commonly referred to as linked-benefit products.
These products combine life insurance with long-term care benefits, allowing you to access benefits, to pay for services such as skilled nursing, in-home care, and medical services.
Learn More: https://www.annuityexpertadvice.com/paying-healthcare-long-term-care-costs/