BOSTON (CBS) – This is the last question for you from the Fidelity’s IQ Retirement Survey.
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Question #8: About how much will a couple retiring at age 65 spend on out-of-pocket costs for health care over the course of retirement?
Answer: Fidelity has been tracking this cost since 2002 and estimates the average 65-year old couple retiring in 2016 will spend $260,000 to pay for out-of-pocket health care expenses over the course of retirement.
Only 15% of those surveyed were on the mark, with 72% underestimating the true amount of health care costs. Overall, 22% underestimated how much they would spend by about $200,000.
Yes, we will have Medicare to cover some of our expenses but we will still pay for Part B deducted directly from the Social Security benefit, then there is Part D for drug coverage and a Medigap policy and perhaps Dental coverage. Don’t forget the copays and over the counter drugs and for some long-term care insurance.
Some folks may have coverage in retirement from a former employer or union but for the rest of us it is something we need to plan for.
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Health care: $260,000
Housing: 528,000 at $2000 a month
Basic Food: 120,000 without wine or dinners out ($15 a day for 2)
Transportation: 130,000 new cars every 10 years & driving under 7000 miles
Some of that $1 million number will come from Social Security benefits, on average about 40% but you will need to finance the rest. Where is it going to come from?
More from Fidelity: Want to Learn More? Fidelity Offers Resources to Help You Know Where You Stand. Every individual’s circumstances and vision are unique, but one of the first steps is to know where you stand on the retirement preparedness spectrum and whether you are on track to meet your goals. With this in mind, Fidelity has introduced a retirement score to enable anyone to quickly and easily estimate whether they’re on track to meet their retirement goals as well as tips to improve, simply by answering a few key questions. In addition, Fidelity offers a variety of resources on their website.
Educational Fidelity Viewpoints® articles, including “Seven ways to boost your retirement IQ , How to get the most out of Social Security,” “Ready to work after your primary career ends?” and a Retirement Roadmap Special edition devoted exclusively to retirement planning. A podcast discussing how much the average person needs to save is also available.
You can hear Dee Lee’s expert financial advice on WBZ NewsRadio 1030 each weekday at 1:55 p.m., 3:55 p.m., and 7:55 p.m.MORE NEWS: Police Continue Searching For Missing UNH Student Vincenzo Lirosi
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