Most people think about retirement as a finish line and do not see it as their next big adventure.
It’s the chapter where you have the freedom to do what you want, on your time, whether that’s traveling, starting a passion project, or spending more time with family.
You can have your investments, your retirement date circled on the calendar, and still get blindsided.
Health care is the piece that too many people ignore… until it starts draining everything they have built.
And the worst part?
By the time they realize it, they’re already in retirement and their options are limited.
I have seen it happen more than once. Let me tell you about one couple in particular…
The Surprise That Changed Everything
A few years ago, a couple came back to me, let’s call them Mark and Sharon, excited about retiring early. Mark was 61. Sharon had just turned 60. They had built a strong financial foundation. They weren’t looking to sit on the couch; they wanted to travel, volunteer, maybe even buy a second home down south.
They came in confident that they had everything dialed in until one overlooked detail brought it all into question.
During our planning process, one number stopped them cold:
$2,100/month.
That was the projected cost of private health insurance coverage before Medicare kicked in. And that didn’t include out-of-pocket costs, deductibles, or prescriptions.
They hadn’t budgeted for that. And it shifted everything.
We reworked the plan, explored the health care marketplace subsidies, strategized around HSA usage, and recalculated when it made sense to tap retirement accounts. It was a reminder of why planning has to go beyond the surface, because missing just one piece can throw off everything else.
Health Care Is One of the Biggest Retirement Expenses, Period
According to Fidelity’s 2024 Retiree Health Care Cost Estimate, the average 65-year-old couple retiring today will need around $315,000 in after-tax savings to cover health care costs throughout retirement.
And that doesn’t include long-term care, which 70% of retirees will likely need.
Let me repeat that:
Seven out of ten people over age 65 will need long-term care services at some point.
This isn’t something to think about later; it’s a key part of retirement planning, and if it’s not built in from the start, it can put everything else at risk.
Health Care Costs Aren’t Just a Budget Line, They Shape Your Options
High health care costs can delay your ability to retire, force you to dip into savings earlier, or limit your choices later on.
That second home?
The road trip you’ve been planning for years?
Helping your kids or grandkids graduate debt-free?
All of it could take a backseat to rising premiums and unexpected bills if your plan isn’t built to handle them.
I don’t share this to alarm you; I am saying it because this is what real planning looks like. It’s not just about hitting some number on a spreadsheet. It’s about building a plan that gives you the confidence and freedom to live your ideal tomorrow, whatever that looks like for you.
Here’s What You Can Do Now
If you’re within 10 years of retirement or already there, here are five steps I recommend:
1. Get a realistic projection of your health care costs in retirement (yes, include pre-Medicare years).
2. Understand how Medicare works, including what’s not covered (like dental, vision, and most long-term care). If you’re approaching enrollment, here are 5 tips to help you determine the right Medicare coverage.
3. Max out your Health Saving Account (HSA) if you’re eligible. It’s one of the most powerful tax-advantaged tools we have. Did you know you can even use an HSA to invest in your future? If you’re not sure whether you qualify or how to make the most of it, we have a Health Saving Account Worksheet that breaks it down and highlights common mistakes to avoid.
4. Explore long-term care insurance or funding strategies. Early planning gives you more flexibility. Not sure what long-term care involves or what it could mean for your finances? This article explains it so you can start to understand what might make sense for you.
5. Work with a fiduciary advisor who can help you integrate these costs (and others) into your broader retirement strategy.
You Only Get One Shot at the Next Chapter, Don’t Wing It
You’ve spent decades building your wealth. You’ve earned the right to enJOY the next phase on your terms, but that takes a well-thought-out plan that doesn’t overlook the less exciting (but important) details.
At Mitlin Financial, we help families plan for what’s next, not just with investments, but with real conversations about what retirement looks like.
If you’re wondering how health care fits into your plan or whether your current strategy holds up under real-world pressure, let’s have that conversation.
It could be the difference between a retirement that’s restrictive… and one that’s wide open.
Your next adventure is waiting.
If you are unsure what that next adventure looks like for you, it would be our privilege to discuss your future and how to plan for a life of purpose, meaning, and JOY!
Let’s make sure your retirement plan isn’t missing anything that could cost you later.
Schedule your free, no-obligation discovery call with the Mitlin Team
To start exploring at your own pace join our weekly newsletter for insights on building a joyful financial life
SOURCES
U.S. Department of Health & Human Services
