The cost of retirement health care looks daunting, especially when you add it all up and get a huge number, which is what the Employee Benefit Research Institute (EBRI) did this week.
EBRI, a think tank funded by pension funds, insurers, banks and mutual fund companies, frequently releases scary numbers, apparently designed to motivate people to save more. It must work -- certainly calculations like this get a lot of media attention. This time EBRI calculated that:
A single man retiring at age 65 in 2010 will need anywhere from $65,000 to $109,000 to cover health insurance premiums and out-of-pocket expenses for a 50% chance of paying health care expenses until he dies, which actuaries say is likely to be at 83. If he wants a 90% chance of having enough to cover his health care expenses, he'll need $124,000 to $211,000.
A single woman retiring at age 65 in 2010 will need between $88,000 and $146,000 to have a 50% chance of having enough money to pay these costs. She'll need between $143,000 and $242,000 for a 90% chance.