Don't let your nest egg crack
Consider how to handle health costs in retirement
If you’re nearing retirement, you might be wondering if your rainy day fund should still include enough to handle 3 to 6 months of expenses.
Because the events that threaten your nest egg are often health-related, the way we prepare for them varies, depending on whether you are 25 or 65. Here are three ways to prepare for health care costs in retirement:
- After you retire, continue to carry health insurance. Consider capping the health care costs you need to cover in any given year by pairing your Medicare plan with an option that supplements your Medicare coverage.
- Hearing aids, regular vision checks and dental care aren’t covered by Medicare. Include these costs in your savings account or income plan.
- Develop a long-term care plan, including some form of long-term care insurance if you’re eligible. The plan addresses things like: Who will care for you if you can’t live independently? Where would you like to be cared for? What will it cost for help if you can’t feed or dress yourself, for example?
Long-term care can be the most expensive health need you’ll have in your retirement years! In 2017, a private nursing home room in Pennsylvania cost an average of $10,000 per month.
Involve your family in conversation about how you’d like to be cared for in a short-term health emergency, as well as in advanced age.
When they know your plans and resources, your loved ones can focus on what matters – caring for you and one another, instead of sweating about whether your nest egg will last.