Though it’s not pleasant to contemplate, according to the US Department of Health and Human Services, an individual who is 65 years of age today has a nearly 70% chance of needing some type of long-term care in their older years. Long-term care is a blanket term that incorporates care over an extended period of time, both in your home or in a facility and it can range from general assistance with daily tasks to more comprehensive medical care. AARP reports that the national average for a private room in a nursing home is $108,405 per year and $61,776 for a home health aide.
Healthcare is one of the biggest and most unpredictable line items to prepare for in retirement. Medicare kicks in when you turn 65 however there is a big gap in what Medicare covers vs. the coverage you’re used to from your employer’s group plan. For a couple retiring in 2015, Fidelity Investments reports that they will need to have an additional $245,000 in savings to cover their healthcare costs in retirement. [Read more…]