A 65-year-old retiring in 2025 can expect to pay $172,500 on average for healthcare and medical expenses throughout retirement. That's according to Fidelity’s 2025 Retiree Health Care Cost Estimate, which is up 4% from the year before. It highlights the general upward trajectory of health-related expenses that have occurred since Fidelity’s first estimate of $80,000 in 2002. The report underscores an even bigger issue: 17% of all respondents have taken no action at all when it comes to planning for health expenses in retirement. One in five respondents said they never consider healthcare needs during retirement. With Gen X, that rises to about one in four. HEALTH CARE COSTS FOR RETIREES CONTINUE TO SOAR Fidelity's estimate assumes enrollment in Medicare (Parts A and B) and Medicare Part D, which includes premiums, co-payments and other out-of-pocket costs for medical care and prescription drugs. However, it does not include long-term care expenses. For instance, even with Medicare, retirees are responsible for Medicare premiums, over-the-counter medications, dental and vision care as well as other types of added expenses like long-term care, according to Fidelity. Some of those costs can be offset with enrollment in Medicare Advantage plans, but those require separate monthly premiums. Chandler Riggs, vice president of financial consultancy at Fidelity Investments, told FOX Business that the rise in healthcare costs is driven by several factors, notably longer life expectancies, as well as a healthcare inflation rate that has outpaced general inflation. Despite the daunting figure, Riggs called Fidelity’s estimate an "important wake-up call for all generations." "It’s not just a benchmark for retirement readiness but also underscores the importance of planning as early as possible," Riggs said. SOCIAL SECURITY CONFIDENCE HITS 15-YEAR LOW AS YOUNGER AMERICANS INCREASINGLY LOSE FAITH IN SYSTEM Matthew Gregory, planning director for private wealth management firm The Bahnsen Group, said people grow accustomed to a hands-off approach during their working years since a meaningful piece of the cost can come directly out of their paycheck.

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