For most of your life, your financial priorities have probably focused on housing, retirement planning, and other more personal goals. However, once you retire, you will probably find that health care expenses become a much larger priority. Those who retire today will face a number of factors that can complicate their financial situations:

  • The cost of health care rises each year, often much faster than the rate of inflation
  • Along with the cost of health care in general, the price of long-term nursing care continues to rise. In fact, it is practically unattainable for many retirees unless they plan carefully.
  • We are living longer lives while this is good news, it also means we are more likely to experience health conditions as more of us can expect to reach our 80s and 90s.
  • Policy makers are constantly reviewing the strain on Medicare and making adjustments to the system in order to keep it solvent – this can mean rising premiums or lower coverage for certain services.
  • Currently, Medicare will cover an estimated 51 percent of your health care expenses once you reach eligibility at age 65. How will you cover the rest?

Considering the above factors, it’s easy to see that retirees face a “perfect storm” of rising expenses. As you continue to plan for retirement, take these steps to manage your future health care costs.

Prevent problems early. The old saying, “an ounce of prevention is worth a pound of cure” could be altered to read, “a dollar of prevention is worth a hundred dollars of cure”. You can prevent or at least postpone the development of many common age-related health problems. Quit smoking, cut back on drinking alcohol, eat a healthy diet, exercise each day, and visit your doctor for preventive health care. Taking these steps in your younger years can make a big impact on your physical and financial health later.

Investigate insurance options. To avoid surprises in retirement, check out the numerous insurance options which can help you manage expenses. Long term care insurance can remove a potentially enormous financial burden, and supplemental Medicare plans can help you manage regular medical bills.

Prepare your budget. You’re aware that you will face financial challenges during retirement, particularly with regard to health care expenses. The best way to meet these expenses is to set yourself up with a stable income. Call us to schedule a consultation, and we can help you analyze your expected expenses, establish a budget, and investigate the different ways in which you can generate income to provide for your lifestyle.