Ninety-two percent of American workers have no idea as to what their healthcare costs will be in retirement or vastly underestimate these costs, says a recent study from Sun Life Financial. The study is based on a survey of working Americans, of which 74% lack specific plans to cover retirement healthcare costs.
Of those surveyed, just 8% estimate they will incur costs of $200,000 or more, which is considered a realistic projection by industry experts.
When asked: “If you retired at age 67 and had to estimate how much your out-of-pocket healthcare costs would be for the rest of your life in retirement, what would you estimate they would be?” survey respondents answered as shown in the following chart.
In terms of confidence in planning for healthcare costs, 43% said they are not at all confident about meeting healthcare costs in retirement and 9% said they are very confident. Half of those in their 50s said they feel “not at all confident” about meeting those costs.
Overall, the data shows that very few are prepared to meet healthcare costs in retirement, and even fewer are making specific plans to save for those expected costs. The survey shows results at a time when Americans are uncertain about the future of Medicare and Medicaid programs, and many have lost savings for retirement as well as investments tied to home values.
View the Sun Life Unretirement survey.
Written by Elizabeth Ecker