Health care could cost couples $280,000 in retirement

Spain leads in global life expectancy; US continues to to slide
FreeImages.com/Pierre Amerlynck
Spain will overtake Japan's long-held position at the top of the world's life expectancy table by 2040, while the United States is set to take a big fall in rankings, new research finds.

Saving for retirement can feel like trying to hit a moving target. The amount you’ll need depends on so many unknowns. But an estimate on health care costs — which could be your biggest expense — can help you plan.

Couples retiring this year will need $280,000 to cover health care and medical expenses over the course of their retirement, according to a new report from Fidelity.

Single men will need $133,000 throughout retirement, and single women, who usually live longer than men, will need $147,000.

The estimate jumped 2% from last year, the smallest increase since 2014.

“Despite this year’s estimate remaining relatively flat, covering health care costs remains one of the most significant, yet unpredictable, aspects of retirement planning,” said Shams Talib, executive vice president and head of Fidelity Benefits Consulting.

The report assumes retirement starts at age 65, when Medicare kicks in, and that men will live to the age of 87 and women will live to 89.

Fidelity’s estimate applies to those with traditional Medicare insurance coverage and considers premiums, co-payments, deductibles, and out-of-pocket drug costs. It excludes the cost of a nursing home or any long-term care you might need.