Americans Underestimate Health Costs in Retirement
According to the annual “Wellness for Life” survey of nonretired adults by Aviva USA, done in collaboration with Mayo Clinic, nine out of 10 people expect to spend less than 20% of their monthly retirement income on medical and dental expenses. Seven out of 10 expect to spend just 10% or less.
Aviva USA noted that data from The Urban Institute indicates people should be prepared to spend approximately 30% of their income on health care expenses in retirement.
“This survey revealed most Americans are unrealistic about some of the repercussions of lifestyle choices and aging – specifically, that as you get older, your health is apt to decline and your need for health care increases. That need for additional care also means there will be additional costs. Getting regular preventive care and improving lifestyle habits to decrease health risks can help reduce these expenses and improve health and quality of life,” said Dr. Philip Hagen, medical director of Mayo Clinic EmbodyHealth and vice chair of the Division of Preventive and Occupational Medicine at Mayo Clinic.The survey found two-thirds of respondents are uncomfortable with their financial situation, and only four out of 10 said they are or will be prepared for retirement. Only one in five work with a financial adviser, although people working with a financial professional are twice as likely to feel comfortable with their financial situation than those who are not.
“This survey reveals the opportunity that exists for people to rethink the role health and wellness plays in retirement planning,” said Chris Jones, chief marketing officer for Aviva USA.
The survey was conducted February 11 to 15, 2013. A national sample of 1,457 nonretired adults ages 18 and older were interviewed online.
More information about the survey is at http://www.avivausa.com.