3 Ways to Avoid High Health Care Costs in Retirement

3 Ways to Avoid High Health Care Costs in Retirement

Retirement brings about a number of costs, some expected and some unexpected. Health care costs seem to be the one expense that few people are financially prepared for, largely because many people assume health insurance or Medicare will foot the bill. That is not the case, however, and any serious health problems in retirement like a bad fall, a chronic illness, or a diagnosis of dementia require long term care that isn’t covered by regular insurance.

To protect both your health and your assets from the high cost of long term health care, consider these 3 ways to avoid high health care costs in retirement:

1)    Invest in your health

The best way to ensure you aren’t stuck with enormous medical bills in old age is to take care of yourself when you are young. Eating right, exercising regularly, and getting enough sleep go a long way in reducing the risk of disease and protecting the heart and brain. Focus on living a balanced, healthful life and you will be much better off as you age.

2)    Look into long term care insurance

The fact remains, no matter how hard you work to stay healthy, the chance always exists that you might need care. Sometimes all it takes is a wrong step and a bad fall to land you in need of care for months. If you haven’t established a plan to pay for that care, you will likely experience some major sticker shock when faced with the out-of-pocket cost. Long term care insurance helps shoulder much of the cost, so you aren’t strapped for cash when you need it most.

3)    Plan ahead

Starting to think about these things earlier rather than later will give you more time to gauge your risk, understand the costs, and save more money. The younger and healthier you are when you purchase a long term care insurance plan, the lower your premiums will be. Factoring these costs into your retirement plan early on will allow you to avoid a financial disaster should you ever end up needing care.

A recent Fidelity study found that the average 65-year-old couple retiring in 2013 will need an estimated $220,000 for health expenses in retirement.

That estimate doesn’t include the cost of long term care, which averages more than $40,000 annually for in-home care and over $80,000 for nursing home care. These kinds of costs are simply unaffordable for the average retiree, which is where long term care insurance comes into play.

Read more about planning for the risk of health care costs in retirement or if you are interested in learning more about long term care insurance, fill out this form and we will send you a free comparison of the top rated companies for you to look over on your own time.

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