Money Matters: Hope for a Healthy Retirement
A new report released by Fidelity Investments estimates how much retired couples will need for health care costs during retirement. It shows projected healthcare costs are up 75% since 2002 and up 2% from last year, reaching approximately $280,000.
Personal finance is just that – personal. Every individual’s financial situation, risk tolerance, and healthcare needs are different. Still, estimates like these can be a helpful starting point.
A savvy consumer reporter can help an audience understand what reports like this mean for them and, critically, what questions they should be asking themselves as they plan for the future.
Here are some ideas to get started.
The short answer is that healthcare costs are increasing and people are living longer, so many older Americans face longer-term chronic health conditions as they age.
Add context for your audience by localizing the issue. How do healthcare costs in your community compare to the national average? What about longevity?
Healthcare costs are just one, albeit growing, factor in retirement finance planning. Add context here by showing how healthcare costs in your area compare with overall cost of living, including housing, taxes, etc.
What it means for you?
The report’s $280,000 number is just one estimate. It builds in assumptions like a retirement age of 65 and eligibility for Medicare, as well as the average longevity of men and women. It’s also an estimate for a couple. But, for most future retirees, not all of these assumptions are true. As with many finance stories, this is a great opportunity to illustrate a variety of scenarios. What would a comparable estimate look like for a single person? Someone who retires earlier, or later? Someone who currently has a chronic health condition?
What to do?
Many consumers will already be familiar with some basic advice. Contributing just a few dollars more per month to a retirement account can pay off significantly when retirement rolls around. Retiring even a few months later in some cases can result in higher Social Security benefits. But how can consumers know what’s right for them and balance their expenses today with the need to save for the future? What about low-income consumers in your area who may struggle to save?
Talking to financial planners and healthcare advocates will often yield some good, generally applicable advice.
For complex issues like this, it may also be worth expanding the scope of your story to include policy responses to increasing healthcare costs.