MERCER BENEFITS U

PLANNING FOR RETIREMENT

Retirement may be the biggest expense of your life, but saving for it doesn’t need to be complicated. These courses will help you take the right steps to pursue the future of your dreams.
RETIREMENT PLANNING BASICS
YOUR PENSION BENEFIT
HSA FOR LONG-TERM SAVINGS
SAVING FOR HEALTH CARE IN RETIREMENT
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Saving for Health Care in Retirement

If you think health care is expensive now, have you considered what it might cost you in retirement?

The truth is, it’s likely to be one of your biggest expenses. According to a recent Mercer survey, only 22 percent of U.S. employees believe they will have enough money to pay for their health care in retirement.1 If this describes you, it’s time to boost your confidence by making a plan.

Crunch the Numbers
The total amount you’ll need to cover health care expenses in retirement depends on many factors, including your life expectancy, your retirement age and the rate at which health care costs increase. For example, the Employee Benefit Research Institute estimates that in 2014, a woman would need $131,000 saved and a man would need $116,000 saved in order to be confident of covering their health care costs in retirement. If your retirement is still years away, it’s safe to assume your number will be higher.

However, these estimates do not include the costs of long-term care. The U.S. Department of Health and Human Services estimates that about 70 percent of people over age 65 will require some type of long-term care services during their lifetime — and that comes with a steep price tag. For example, according to a 2015 Genworth study, the median annual rate for nursing home care in the U.S. is $80,300.2 Some quick math, and we can see that five years in a nursing home could cost more than $400,000.

As you’re considering what your future health care expenses might look like, it’s also important to know how government programs, like Medicare, may play a role. For example, Medicare will generally help cover a range of services and supplies deemed medically necessary, like hospital visits, preventive care and medical equipment. But it won’t cover long-term care in a nursing home for people who need help with basic daily activities, like bathing and dressing. Visit http://www.medicare.gov to see more information about what’s covered and what’s not.

To get a clearer picture of your future health care costs:

Budget for it
No one can know for sure how healthy they will be in the future or exactly what their health care might cost. That’s why it’s so important to plan ahead as best you can — and that means factoring in health care as a big part of your total retirement expenses. Also consider:

By preparing now, you can feel more confident that you’re ready for both the fun and the necessities that retirement will bring.

Need Some Help?
When in doubt, turn to a financial adviser who can help you prepare for future health care costs. If you’re searching for a financial adviser, visit reputable websites such as the Financial Planning Association or the National Association of Personal Financial Advisors.

1 Mercer’s 2015 Inside Employees’ Minds survey.
2 Genworth 2015 Cost of Care Survey; cost is for a semiprivate room.
3 Employee Benefit Research Institute, October 2014 report. Estimates do not include the costs of long-term care.

Copyright 2016 Mercer LLC. All Rights Reserved.

Saving for Health Care in Retirement

If you think health care is expensive now, have you considered what it might cost you in retirement?

The truth is, it’s likely to be one of your biggest expenses. According to a recent Mercer survey, only 22 percent of U.S. employees believe they will have enough money to pay for their health care in retirement.1 If this describes you, it’s time to boost your confidence by making a plan.

Crunch the Numbers
The total amount you’ll need to cover health care expenses in retirement depends on many factors, including your life expectancy, your retirement age and the rate at which health care costs increase. For example, the Employee Benefit Research Institute estimates that in 2014, a woman would need $131,000 saved and a man would need $116,000 saved in order to be confident of covering their health care costs in retirement. If your retirement is still years away, it’s safe to assume your number will be higher.

However, these estimates do not include the costs of long-term care. The U.S. Department of Health and Human Services estimates that about 70 percent of people over age 65 will require some type of long-term care services during their lifetime — and that comes with a steep price tag. For example, according to a 2015 Genworth study, the median annual rate for nursing home care in the U.S. is $80,300.2 Some quick math, and we can see that five years in a nursing home could cost more than $400,000.

As you’re considering what your future health care expenses might look like, it’s also important to know how government programs, like Medicare, may play a role. For example, Medicare will generally help cover a range of services and supplies deemed medically necessary, like hospital visits, preventive care and medical equipment. But it won’t cover long-term care in a nursing home for people who need help with basic daily activities, like bathing and dressing. Visit http://www.medicare.gov to see more information about what’s covered and what’s not.

To get a clearer picture of your future health care costs:

Budget for it
No one can know for sure how healthy they will be in the future or exactly what their health care might cost. That’s why it’s so important to plan ahead as best you can — and that means factoring in health care as a big part of your total retirement expenses. Also consider:

By preparing now, you can feel more confident that you’re ready for both the fun and the necessities that retirement will bring.

Need Some Help?
When in doubt, turn to a financial adviser who can help you prepare for future health care costs. If you’re searching for a financial adviser, visit reputable websites such as the Financial Planning Association or the National Association of Personal Financial Advisors.

1 Mercer’s 2015 Inside Employees’ Minds survey.
2 Genworth 2015 Cost of Care Survey; cost is for a semiprivate room.
3 Employee Benefit Research Institute, October 2014 report. Estimates do not include the costs of long-term care.

Copyright 2016 Mercer LLC. All Rights Reserved.