Fidelity Investments® released its 25th annual Retiree Health Care Cost Estimate, revealing a 65-year-old retiring in 2026 can expect to spend an average of $185,500 on health care and medical expenses throughout retirement.
Why it matters: Up 7.5 percent from one year ago, the increase reinforces broader health care market trends, including rising prices for care, continued utilization growth, and growing costs tied to chronic conditions.
Yes, but: Despite the rise, this year’s estimate comes on the heels of positive news, as recent Fidelity research finds Americans’ retirement confidence is trending up as 72 percent say they will retire on their own terms, and nearly three-quarters say they have a plan in place to reach their retirement goals.
- This confidence is driven in part by awareness and preparation. The vast majority (81 percent) understand health care costs in retirement to be high, and one-quarter (26 percent) identify health care costs as a top retirement savings challenge.
“Financial planning for retirement is about more than reaching a savings target, especially as retirement itself continues to evolve,” said Shams Talib, head of Fidelity Workplace Consulting.
- “Whether Americans fully stop working, phase into their retirement, or pursue new ways to stay engaged, health care consistently remains one of the largest expenses they will face. Providing a benchmark to consider can help them plan with purpose and more confidence.”
