The Healthcare Question: Are you really retirement ready?

For many nearing their retirement, the biggest unknown isn’t when to stop working, but how much it will cost to stay healthy once you do.

Healthcare is one of the fastest-growing expenses for retirees. Even if you’ve saved diligently, rising costs, longer life spans, and unexpected care needs can affect even the best-laid plans. Here are three considerations to keep in mind:

1. Medicare Isn’t Free

Medicare provides important coverage, but it does not pay for everything. You’ll still face premiums, deductibles, co-pays, and costs for services such as dental, vision, and hearing. Many people choose supplemental coverage to help offset these gaps, which comes with additional monthly costs.

2. The Rising Price of Long-Term Care

According to the Genworth Cost of Care Survey 2024, the national median annual cost of a private room in a nursing home is $127,750 and has risen an average of 2-3% per year over the past decade1. Many retirees may require some form of long-term care during their lifetime. Without planning, these costs could reduce retirement savings faster than expected.

3. The Inflation Factor

The Bureau of Labor Statistics Consumer Price Index shows that healthcare costs have historically increased faster than general inflation. That means the dollars you’ve saved today may not stretch as far 15or 20 years from now. A diversified approach and sustainable withdrawal plan may help keep your retirement strategy on track.

The Bottom Line

Retirement isn’t just about whether you’ve saved “enough.” It’s also about whether you’ve prepared for the expenses that don’t stop (and often increase!) as you age. Addressing healthcare considerations early can help you create a more resilient retirement strategy.

If you’re within 10 years of retirement, or want to know how to retire early, now is the time to review your healthcare plan. Centurion Wealth Management’s team of financial advisors can help you evaluate coverage options, consider long-term care planning, and build healthcare costs into your retirement income strategy.