Quote:
Originally Posted by MercyMe
Fidelity's website says their planner gradually decreases inflation on health care expense over time...
"Healthcare expenses have a higher inflation rate of 4.9%, which will gradually decrease to the 2.5% default rate."
Why would they do that?
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I notice the same language in the pdf documentation for the tool as well. Maybe the tool is assuming that at age 65 when Medicare kicks in, healthcare cost will keep pace with the general inflation rate used by the tool (2.5%).
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Health Care Expense Inflation Assumption
The Tool makes the following inflation assumption and does not
allow you to change this inflation rate.
• Health Care Costs: The default inflation rate of health care costs
is a schedule of rates, which start at 4.9% for some time and
slowly decrease to general inflation, based on Fidelity research.