How Much Does Healthcare Cost in Retirement?
Healthcare is the most underestimated retirement expense. Here's what you'll actually spend on medical care after 65 — and how to plan for it.
4 min read · By John G. Ziesing, FRC
The Numbers Are Sobering
Fidelity estimates that a 65-year-old couple retiring in 2026 will need approximately $330,000 to cover healthcare costs in retirement. That's not a typo — $330,000. This includes Medicare premiums, supplemental insurance, copays, prescriptions, dental, vision, and hearing.
What Medicare Doesn't Cover
Medicare covers about 80% of medical costs after deductibles. It does NOT cover: dental care, vision (glasses/contacts), hearing aids, most long-term care, and many prescription drugs (without Part D). These 'gaps' are why most retirees need a Medigap supplement or Medicare Advantage plan.
Typical Monthly Healthcare Costs at 65+
Medicare Part B: ~$185/month. Medigap supplement: $150-$300/month. Part D (prescriptions): $15-$100/month. Dental: $30-$50/month. Vision: $15-$25/month. Out-of-pocket copays and services: $100-$300/month. Total per person: $500-$900/month.
How We Plan for Healthcare at ACM
We include healthcare as a line item in every retirement budget we build. We also recommend creating a dedicated healthcare 'bucket' — a portion of savings specifically earmarked for medical expenses. An HSA (if you have one) is the most tax-efficient way to save for healthcare in retirement.
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