Americans can expect to pay a lot more for medical care in retirement

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“There’s a lot of upward cost pressure in the health-care system right now, due to investments that providers need to make to get ready for the next pandemic, due to issues around labor, particularly hospital nurses,” said Hope Manion, senior vice president and chief health and welfare actuary at Fidelity Investments.

Fidelity also found that most Americans have underestimated what health-care expenses will be in retirement, with the average person expecting costs to be $41,000 — a $274,000 shortfall from its estimate. 

The most important thing is that you start saving and you start

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How to fight the impact of inflation on retirement health-care costs

Prices for gas, food and housing have skyrocketed in the last year. Less noticeable, to some, is the rising cost of health care. 

Medicare, the U.S. government’s national health insurance program for Americans age 65 and over, imposed a 14.5% increase in premiums for Part B (outpatient care coverage) for 2022, a record high and nearly double the March reading of the annual U.S. rate for inflation as measured by the Consumer Price Index. 

Rising health-care inflation can have major consequences for current and future retirees, as medical expenses are expected to take up an ever-greater share of retirees’ income.

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