When most of us picture retirement, we think about freedom — more time with family, travel, hobbies, and simply enjoying life. But one big expense that often gets overlooked is health care. While many assume Medicare will cover most healthcare costs, that’s not always the case. In fact, Fidelity estimated that a couple retiring at 65 in 2024 may spend about $330,000 out of pocket on health care during retirement — far more than most people expect.
Medicare is an important piece of the puzzle, but it comes with its own costs and choices. Part A may be premium-free, but Part B includes a monthly premium (and possibly an income-based surcharge). Then there are deductibles, copays, and prescription drug expenses. Many retirees also add a Medicare Supplement (Medigap) or Medicare Advantage plan to help manage out-of-pocket costs. Building these expenses into your retirement plan now can help prevent financial surprises later.
The good news? A little planning goes a long way. If you’re still working and have an eligible health care plan, consider contributing to a Health Savings Account (HSA) — your money goes in tax-free, grows tax-free, and can be withdrawn tax-free for qualified medical expenses in retirement. Once retired, review your coverage each year to ensure it still fits your needs and lifestyle. Taking time to plan for health care costs today helps you enjoy a healthier, more confident retirement tomorrow.
- Giardini Medicare – A Michigan based company, Giardini is an independent firm that specializes in guiding individuals through their first Medicare enrollment. They represent all the major carriers in Michigan. Contact them at 248-871-7756, by email at info@gmedicareteam.com, or online at gmedicareteam.com.
- ClearMatch Medicare through Raymond James – A convenient, phone-based resource for comparing and evaluating Medicare plans for those 65 years and older. ClearMatch provides straightforward guidance to help you sort through options and make confident choices during your enrollment period. Contact ClearMatch at 844-269-2646.
- Chapter through Raymond James – A personalized, comprehensive Medicare advisory service with access to more than 24,000 plans. They offer access to licensed advisors with advanced technology to deliver highly personalized plan comparisons. Chapter offers ongoing, year-round support to ensure your coverage continues to meet your needs. This is also a great option for those under 65 who are not employed. Contact Chapter at 978-735-4467 or visit askchapter.org/partners/raymondjames
Source: Fidelity. 2024 Retiree Health Care Cost Estimate. Released August 8, 2024.
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