Fidelity Investments' recent health care cost estimate has revealed that 65-year-old couple retiring in 2008 will need approximately $225,000 to cover medical costs in retirement.
This figure is a 4.7% increase over the 2007 estimate of $215,000. The retiree health care cost estimate is issued annually by Fidelity Investments. Since the estimate was first calculated in 2002, the number has raised a total of 41%, with an average annual increase of 5.8%.
As in past years, the 2008 estimate assumes individuals do not have employer-sponsored retiree health care coverage and includes expenses associated with Medicare Part B and D premiums, medicare cost-sharing provisions – co-payments, co-insurance, deductibles and excluded benefits and prescription drug out-of-pocket costs.
Brad Kimler, executive vice president, said: Given current economic conditions, this is especially true for those planning to retire in the next few years or before they qualify for full social security or medicare benefits.