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Fidelity: $225,000 in savings needed per couple for Retirement Health
A couple retiring this year will need about $225,000 in savings to cover medical costs in retirement, according to a study released Wednesday by Fidelity Investments and reported in The Washington Post. The figure, calculated for a couple age 65, is up 4.7% from the $215,000 estimate for 2007, the Boston-based financial services company said. The study assumes workers do not have employer-sponsored retiree health care coverage. It includes expenses associated with Medicare premium payments as well as co-payments and deductibles, plus out-of-pocket prescription drug costs. Fidelity's first study, in 2002, found that a couple needed $160,000 in savings to fund medical costs in retirement; that total has risen an average of 5.8% a year. The study blamed the rising health care costs this year on reasons that include higher costs for services such as doctors’ visits; rising expenses associated with new technologies; and increased incidence of some chronic conditions, like diabetes. “The Center for Retirement Research at Boston College estimates that six in 10 older workers are at risk of being unable to maintain their standard of living in retirement,” said Ruben Burks, Secretary-Treasurer of the Alliance. “I hope that those who are currently planning their retirements are factoring in enough for health care.”
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