By Shirley Ikehara – On average, women live longer than men and face distinctly different challenges in maintaining their health. Perhaps as a result, women tend to spend more than men on out-of-pocket medical expenses in retirement. According to a 2012 Employee Benefit Research Institute (EBRI) study, retired men spent an average of $124,000 on healthcare, while retired women spent $152,0001 — $28,000 more than their male counterparts. In addition, women are more likely to need (and to spend more money funding) long-term care, some of which isn’t covered by Medicare.
With these expenses in mind, it’s not surprising that the cost of healthcare is one of the biggest retirement planning concerns for Americans. Though it’s essential that everyone plan financially for healthcare needs in retirement, it’s especially important that women understand the specific challenges they may face. This knowledge may help women work toward preparing for these expenses and to help avoid a financial shortfall in retirement. Start by:
· Estimating your healthcare costs — Begin by assessing your overall health and family health history. Calculate your current annual medical and dental expenses as a starting point. For help projecting what these costs may be in retirement, use an online healthcare calculator or estimator to help you become familiar with treatment costs for a variety of health and dental conditions. Also become educated about various long term care insurance options to determine if a policy might be right for your situation.
· Being realistic — If you think you’ve got it covered with Medicare, think again. Today Medicare only pays about 60 percent of retiree healthcare costs and it doesn’t reimburse for most long-term care expenses.2 Plus, there’s uncertainty about how much it will cover in the future due to potential entitlement reform changes. Knowing the challenges you may face with your health – and what they may cost – can make a difference in being prepared.
· Creating an emergency fund — Reducing your debt and saving as much as you can before you retire is the simplest way to prepare for an unanticipated need — medical or otherwise. If your balance sheet is healthy, you’ll likely be better positioned to absorb medical costs not covered by Medicare.
· Being proactive about your health — Schedule and keep routine dental and medical check ups and stay up-to-date on preventative services including the flu and pneumonia vaccines, colorectal cancer screening and mammography. Thoughtful prevention and early detection can help prevent minor medical issues from becoming major ones. Maintaining a healthy diet, exercising regularly and avoiding tobacco and other addictive substances is important to quality of life at any age. It’s also one of the best and most inexpensive ways to keep medical bills at bay.
· Consider setting up a health savings account (HSA) — An HSA allows you to make tax-deductible contributions when you put money in. The money builds up tax-free and you can withdraw it tax-free for qualified medical expenses.3 Unlike a flexible spending account, you don’t lose money you don’t use. It rolls over and is 100 percent portable. Plus, you can use it anytime during your lifetime to pay for qualified medical expenses. Keep in mind that if you withdraw funds for non-medical purposes, you are subject to a tax penalty.
Unfortunately, when it comes to healthcare costs in retirement, there is no silver bullet solution. But by following these tips, you can help take control of the things you do have influence over now to help prepare. Consider working with a financial professional who can help you factor real and potential healthcare costs into your overall financial plan for retirement.
Shirley Ikehara, CFP®, CFS®, CRPC®, is a Financial Advisor (and CERTIFIED FINANCIAL PLANNER practitioner™) with the practice of Shirley Ikehara & Associates at Ameriprise Financial Services, Inc. in Honolulu, Hawaii. She specializes in fee-based financial planning and asset management strategies and has been in practice for 17 years. Shirley is licensed/registered to do business with U.S. residents only in the states of Hawaii, California, Virginia, and Pennsylvania.
Politicians do not differentiate between Medical Care and Health Care. The US has the best Medical Care in the World.
Health Care is what an individual should be concerned about since it is up to each individual to take care of them self.
This means exercise, diet and sins to avoid, such as, alcohol, tobacco and illegal drugs.
[…] What every woman should know about healthcare costs in retirement Estimating your healthcare costs — Begin by assessing your overall health and family health history. Calculate your current annual medical and dental expenses as a starting point. For help projecting what these costs may be in retirement, use an … Read more on Hawaii Reporter […]
According to the Dentist Montreal working policy, it requires to review of the medical and dental histories along with dental x-ray plus clinical examination after complete initial paper work
Though it’s essential that everyone plan financially for healthcare needs in retirement, it’s especially important that women understand the specific challenges they may face
Schedule and keep routine dental and medical check ups and stay up-to-date on preventative services including the flu and pneumonia vaccines, colorectal cancer screening and mammography
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