FIRECalc with Healthcare

[Mdm963]

Thanks for this amazing calculator! Just wanted to ask how to consider healthcare costs if retiring early? Thanks in advance!

 

[MichaelB]

Thanks for this amazing calculator! Just wanted to ask how to consider healthcare costs if retiring early? Thanks in advance!

FIRECalc doesn’t look at individual expense items. You input your projected budget and add any unique or unusual spending items. You can calculate and project healthcare costs, then include them in your overall budget.

If you haven’t figured out your healthcare costs yet you can ask about that. There are many threads on ACA, costs, premium assistance and subsidies, and members here are very knowledgeable about that.

 

[Dtail]

Some calculators such as the Fidelity Retirement calculator do use a separate inflation figure for medical expenses, which is different from the overall inflation figure.

 

[Mdm963]

Thanks guys for the quick reply. I can estimate some healthcare cost, but how can I have the model apply it only between retirement and age 65 when Medicare kicks in? In other words, how do I input expenditures for only certain years?

 

[Dtail]

Thanks guys for the quick reply. I can estimate some healthcare cost, but how can I have the model apply it only between retirement and age 65 when Medicare kicks in? In other words, how do I input expenditures for only certain years?

In Firecalc, under the 2nd tab "Income/Spending", you can input the yearly spending (Off Chart Spending) starting with the retirement year, then input Pension Income on the next line starting with the Medicare year.

 

[Aerides]

Thanks guys for the quick reply. I can estimate some healthcare cost, but how can I have the model apply it only between retirement and age 65 when Medicare kicks in? In other words, how do I input expenditures for only certain years?

Depending on your plan, it might not be terribly different. Medicare isn't free since most get various add-ons. I expect to be paying at least the same as we do now with subsidized ACA premiums, although without the large deductible.

Generally speaking, I'd rather err on the side of overestimating healthcare costs down the road.

 

[latexman]

My free Fidelity Financial Consultant help me with healthcare costs in retirement. Here is a Fidelity article.

“According to the Fidelity Retiree Health Care Cost Estimate, a single person age 65 in 2023 may need approximately $157,500 saved (after tax) to cover health care expenses in retirement. An average retired couple age 65 in 2023 may need approximately $315,000 saved.”

 

[Mdm963]

Huge help guys, thanks a ton!

 

[Rianne]

When I first discovered Firecalc, thanks to this forum, I entered our actual spending and all the correct data. I change the numbers all the time now considering LTC, and unusual spending (emergencies). The "what if" factor is just to feel secure.