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Consider effect of healthcare costs later in life 2010-03-25 Healthcare costs are likely to represent a large share of a retiree's budget, MarketWatch says. A recently released Fidelity Investments study shows that retirees will spend $250,000, on average, on healthcare. While the study is not representative of all retirees' needs, MarketWatch notes, it hints at the substantial costs of healthcare for older people. Medical expenditures were second only to food in retirees' spending hierarchy, Fidelity said. On average, older people spent $535 per month - about 20 percent of their income - on healthcare. And, troublingly, 47 percent of people said they were spending more on healthcare than they had anticipated before retirement. As MarketWatch noted, people can choose between saving for retirement healthcare expenses during their working lives and paying out-of-pocket later. Whichever option a person picks, he will need to pay for his healthcare - but some people may find that their medical expenses are excessively burdensome. For those who cannot afford to pay their medical costs, it may be wise to draw on home equity, if possible. Reverse mortgages and home equity lines of credit allow older people to tap into their equity.  |
