This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Save Thousands of Dollars by Delaying Retirement Just 5 Years

NEW YORK (MainStreet) This is not about Social Security. While retirees can draw benefits at age 62, delaying benefits to full retirement age generally around age 65, depending on your date of birth will boost your monthly Social Security check. But there is another way to pad your retirement budget, and it's all about health care.

Medical expenses for a 65-year-old retired couple will cost an average of $220,000 during retirement, according to Fidelity Benefits Consulting research. That's a big number, but surprisingly that estimated cost did not rise in the past year, due to a number of factors including lower-than-expected Medicare spending and long-term savings on prescription drugs.

No doubt about it, health care is one of the largest expenses in retirement. Deciding when to retire can impact that cost. Retiring just three years earlier, at age 62, a couple could expect to pay $17,000 per year in health insurance premiums -- for the period prior to Medicare covering kicking in -- as well as out-of-pocket expenses. That will boost the total ticket for retirement healthcare to $271,000.

Delay life after work until age 67 and that same retired couple could save more than $70,000 paying an average of $10,000 a year for health care and reducing their estimated costs during retirement to $200,000.

"We understand that some people don't have a choice in when they retire," says Brad Kimler of Fidelity. "Sometimes health issues or someone's occupation plays a role. So it's critical that people plan well in advance for the considerable cost of health care by adding it into their overall retirement planning discussions."

The estimated health care costs exclude nursing-home care and considers only traditional Medicare insurance coverage.

"Rising health care expenses are forcing people to make educated decisions now more than ever, ranging from the services they utilize to the age they choose to retire," adds Kimler.

Fidelity's health care cost estimate rose an average of 6% per year for nearly a decade, then began declining in 2010.

"However, increases in aggregate Medicare spending have grown at a faster rate because of a larger number of beneficiaries," the report says. "While the current trend of lower spending per enrollee has had a positive impact on Medicare costs, the growth in Medicare enrollees over the next few years is expected to continue to strain Medicare-related resources."

--Written by Hal M. Bundrick for MainStreet

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,884.62 +79.82 0.45%
S&P 500 2,070.12 -0.53 -0.03%
NASDAQ 4,766.1190 +0.7390 0.02%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs