An impending retirement can fill your head with a lot of things to worry about, and while finances take up most of that space, it is a fact that healthcare quietly nibbles on our budgets and eats it up: a factor that is usually not taken into account as keenly while planning for retirement but should be given due consideration.
According to sources the three key factors driving US healthcare costs are treating chronic illnesses like cancer and heart diseases, rising prescription drug costs, and the unhealthy lifestyle choices of the masses which includes excessive drinking and smoking. Recognizing these facts must have an influence on your retirement plan.
Following are some things which offer food for thought for those of you approaching retirement.
Statistics suggest that on average men and women can expect to live for approximately 84 and 86 years respectively. One out of every four 65-year-olds can live up to 90 and one out of every ten should expect to live even past 95.
Life expectancy has a direct impact on healthcare cost: the higher is the life expectancy, the higher would be the cost. Those in poor health conditions end up spending less compared to people with better health as their life span is longer and hence more care is required over the longer period of time.
Reliance on Medical Insurance
Inadequate information of your retirement health care insurance plan tends to create a lot of confusion. Before you turn 65, it is vital that you contact social security services and find out the benefits you are entitled to along with their limitations. A comprehensive understanding of your basic insurance plan is very crucial to avoiding any unpleasant surprises.
The general understanding is that a lot of post-retirement healthcare plans already cover healthcare however that is usually not the case. Costly treatments like dental, vision, and ear-related treatments are not likely to be included and must be paid for through other means.
Due to this reason people eventually end up spending more on healthcare than they originally planned and as a result end up upsetting their original spending goal.
Longer Life Leads to Higher Bills
Soaring prices are never good news especially when it comes to healthcare. But like everything else, with the passage of time the cost of appointments, medicines, procedures and treatments are all spiking. And since our life expectancy has actually increased during these times, we are spending way more on healthcare than we used to in the past.
So, when you are planning for your health care after retirement do keep in mind that the longer you live the higher will be the cost of your living and care. While you set aside your assets for different purposes take factors like inflation and rising healthcare costs into consideration and allocate amounts accordingly.
The Retirement Income Strategy
A thorough, detailed retirement plan is key to living a stress-free life post-retirement. Of course, anything can affect even the most detailed plan so make sure you plan for the unexpected with appropriate contingencies. The plan must be strategically devised keeping in mind the influence of external key factors such as legislation policies, inflation and personal life events.
We spend our whole life juggling between a million things, but it is important to plan for our retirement well in advance. The financial aspect of this plan is naturally of crucial importance. Before getting started it is important to keep in mind that you decide what is best for your life and how to best utilize your assets.
Conferring to a friend or a relative whose cultural or financial situation is not similar to yours might not actually be a good idea. So, be your own judge and think about what is best for you. Keeping all expenses in mind, give utmost priority to your health care. Plan in advance for problems that run in your family’s history and then accumulate the ones which apply to your lifestyle.