Data & Research
Average Cost of Retiree Health Care: $260,000
Health-care costs for retiring Americans, including nursing home care,
average $260,000 and can exceed $500,000, according to research
conducted by the Center for Retirement Research (CRR) at Boston College
and underwritten by Prudential Financial.
Reported by Rebecca Moore
When nursing home costs are included, the amount a typical couple will need for health care expenses increases to $260,000, with a 5% risk of exceeding $570,000.
The report noted that less than 15% of households approaching retirement have accumulated that much in total financial assets.
The CRR undertook the study to better determine the risk American households face of incurring exceptionally large health-care expenses in retirement. “The objective of the analysis was not to calculate how much households spend on health care in practice, or even how much households should optimally choose to set aside to cover health care costs—but to quantify the magnitude and distribution of potential lifetime expenditure,” said Anthony Webb, associate director of research for the CRR, in a news release.