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No Elephants Donating Member (1000+ posts) Send PM | Profile | Ignore Wed May-09-12 06:39 AM
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Health care costs worry near-retirees
Health care costs worry near-retirees

by Christine Dugas - May. 7, 2012 09:10 AM

The pre-retirees who expect health care to be their biggest retirement expense estimated that their average annual health care cost will total $5,621. But that is a drastic underestimate. Citing a 2011 Fidelity study, Nationwide says out-of-pocket health care expenses will average as much as $10,750 a year.

One big reason is that pre-retirees often wrongly assume that Medicare covers the cost of long-term care, Carter says. That is a wake-up call that Americans need good financial advice to prepare for their future health care costs, he says.

"There are a lot of things that are not covered" by Medicare such as most eye care, dental and hearing, says Henry "Bud" Hebeler, a former Boeing executive who developed the retirement planning website "I've had to have two pairs of hearing aids so far and they cost me over $5,000 each time, says Hebeler, 78.

People also don't realize that Medicare will be financed partly by premiums deducted from Social Security checks, Hebeler says. "Depending on a retired couple's income, their annual Medicare cost could be over $9,000 a year," he says.

Last month, a government trustee report said that Medicare will be exhausted by 2024 and Social Security by 2033. That reality is forcing many workers to plan to work longer. This year, 57(PERCENT) of workers who have $50,000 to $250,000 in household assets plan to push back their retirement, citing health care costs as their top financial concern, up from 36(PERCENT) in 2011, says Bank of America's Merrill Edge report.

Even if we have Medicare for all, we have to control the costs themselves, IMO.
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