While retirement plan providers do not necessarily agree on the amount that individuals will need in retirement, everyone agrees that the goal for participants is to be able to live comfortably and not outlive their savings.
Healthcare costs will be a major expense for retirees and many are unprepared and unaware of the impact they will have on their retirement savings.
A 2013 study by Fidelity Investments found that 48 percent of respondents, ages 55 to 65, believe they will need just $50,000 to pay for healthcare costs in retirement. However, a report from the Employee Benefit Research Institute (EBRI) estimates that a couple aged 65 might need $387,000 saved in order to be confident of covering their healthcare costs in retirement, not including outlays for long-term care.
Some providers have developed tools for participants to use in estimating how healthcare will impact their retirement savings. Plan sponsors should have an understanding of how their provider is currently dealing with this topic with their participants and what resources are available to them.