Affluent seniors underestimate healthcare costs in retirement, survey finds
Even affluent older Americans are worried about the high costs of healthcare as they approach retirement age, a new study reveals.
Financially secure seniors — who for this study were defined as seniors who have $250,000 or more in household assets and plan to retire by 2020 — drastically underestimated how much they would need to spend annually on healthcare, according to a Harris Poll released by Nationwide Financial. Seniors estimated that their annual average healthcare costs in retirement to be roughly $5,621 annually, whereas the national average for this age group is actually $10,750.
According to recent research, assisted living residents generally are high- to mid-income individuals who pay for their AL stays out of their own pocket.
“One reason people may underestimate the amount of money needed to cover their healthcare costs in retirement is that many workers do not think they will ever need long-term care,” said Kevin McGarry, director of Nationwide Institute for Retirement Income, in a statement. “Americans also mistakenly believe that Medicare covers long-term care.”