Americans are already under the gun trying to save enough for retirement, but they’re forgetting one essential—and large—expense: health care.
A new paper from HealthView Services, which provides health care cost data to the financial industry, points out that while people are struggling to save enough to pay for the basics during retirement — food, shelter, utilities — health care expenses aren’t even on the list for many, many of whom are still dealing with the aftereffects of the Great Recession.
This is particularly true for future retirees, according to the paper, “Closing the Retirement Health Care Costs Planning Gap: The Next Retirement Planning Challenge.” The paper points out that, while many retirees aren’t feeling the full effects of the bill for retirement health care, future retirees won’t be so lucky.
The employer-provided health care and pension plans still in force for many of those already retired, in addition to relatively low costs for Medicare premiums, will be a thing of the past for those still in the workplace, the paper says. Those future retirees will be even more dependent on what they’ve managed to put away than today’s retirees, and they just aren’t saving enough to manage the additional cost of health care — they aren’t even saving enough for basic expenses.
People need to get a handle on potential healthcare expenses in retirement and start saving more, the paper says, and to that end HealthView has launched a set of consumer-oriented retirement health care planning tools to help Americans incorporate health care costs into retirement plans.
The tools, it says, “give consumers the ability to better understand expected health care costs in retirement, long-term care costs and future retirement savings.” Consumers can fill out basic information, such as age, gender, location and health status and the tools will provide a report that lists average costs for people in similar circumstances.
Based on the premise that if people better know what to expect they will be able to plan better and save more, the tools are designed to show people what they might have to pay for medical expenses in retirement.
“Our health care costs calculator draws upon more than 50 million health care cases and a broad range of data points to provide a comprehensive perspective on the expected health care costs retirees will have to pay for out of their own pockets,” Ron Mastrogiovanni, founder and CEO of HealthView, said in a statement.