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Too many people assume that Medicare will cover their medical costs after age 65 and fail to save. While Medicare does pay almost two thirds of seniors’ health costs, a new analysis by EBRI finds that an average American 65 year old man retiring this year without employer-sponsored premium assistance needs $109,000 in savings just to be 50% sure of covering his future medical bills. Women need to save even more at $146,000. To be 90% sure, they would need $211,000 and $242,000 respectively. That man, if he retires in 2020, needs $183,000. Retirees lucky enough to have employer subsidies are not off the hook – men retiring in 2010 need $66,000 and women need $88,000 in savings to meet just median likely health costs. Not surprisingly, CT is the most expensive state for Medigap coverage and we should be saving even more.
Ellen Andrews