Yesterday I was reviewing a retirement plan with a single man age 56 who wants to retire at age 62. It turns out that he will have to work to age 65, but will have to watch his pennies, mostly due to future health care needs. As a typical employee, he pays very little out of pocket right now for health care. I discussed with him the potential increases he will have to pay toward health care in retirement. Needless to say, he was shocked. When he retires at age 65 he will apply for Medicare and he will also have to look into the variety of supplements necessary to cover what Medicare does not. If you then add in deductibles and out-of-pocket costs, it adds up fast. A 65 year old retiring today may need an additional $130,000 just to cover long term care needs such as home health aids, assisted living, or full nursing home. Another point to consider is inflation as health care cost have been going up an average of 3%/year and this trend probably will probably continue.
Please make sure you do your health care homework prior to retirement. A well researched decision is the best one.

disclosures:http://www.hechteffect.net/?page_id=31