Many companies featured on Money advertise with us. Opinions are our own, but compensation and
in-depth research determine where and how companies may appear. Learn more about how we make money.

Advertiser Disclosure

The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

By Elizabeth O'Brien
April 2, 2019
Photo illustration for Money; Getty Images (2)

The average couple retiring in 2019 at age 65 will need $285,000 to cover health care and medical costs in retirement, according to an annual estimate by Fidelity, released today.

For single retirees, the estimate is $150,000 for women and $135,000 for men, according to Fidelity. (These are estimates for today’s 65 year olds — barring major changes to the U.S. health care system, the numbers will be much higher by the time younger people reach that age.)

The good news is that health care costs have risen moderately in recent years — up just 3.6% over the past two years combined, compared with a 12.2% increase from 2015 to 2017. But the bad news is that retirement health care remains a budget-buster, underscoring the fact that Medicare coverage is neither free nor completely comprehensive.

Fidelity’s estimate assumes that both members of the couple are 65 and on Original Medicare, not a private Medicare Advantage plan. The $285,000 includes premiums for Part B doctor coverage and Part D drug coverage, out-of-pocket costs such as deductibles, as well cost-sharing requirements for drugs. It also includes certain services and devices that Medicare doesn’t cover, such as hearing aids.

Notably, the estimate does not include long-term care costs such as nursing home or assisted living expenses. It also excludes the cost of home health aides. Medicare doesn’t pay for the kind of long-term care costs that most older adults need — that is, so-called “custodial care” to help with activities of daily living such as bathing, eating and dressing, either at home or in a care facility. The national median cost of a bed in a semi-private nursing home is $89,297 a year, while assisted living costs $48,000 a year, around the same cost as 44 hours a week of a home health aide, according to Genworth’s 2018 Cost of Care Survey.

Fidelity assumes lifespans of 87 for a man and 89 for a woman.

 

Advertiser Disclosure

The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

EDIT POST