Anyone who has gone to the supermarket or gas station this year knows that inflation is taking a bite out of American wallets. Choosing cheaper products and trading in cheaper cuts of meat have become common trade-offs for families on a tight budget.
When it comes to health care in particular, difficult choices today can mean bigger problems down the road. A new survey from the Nationwide Retirement Institute® finds that inflation has forced many Americans to make troubling choices, including stopping taking a prescribed drug: 10% say they have, and another 13% are considering doing so. this year. A similar number (10% and 15% respectively) say they have canceled or postponed a medical procedure or are considering doing so.
Despite squeezing every penny, as many as 49% of Americans say their healthcare costs have increased this year, with no relief expected any time soon. A third (32%) fear that the monthly health care premium will rise and 40% expect the costs of prescription drugs to rise. Of course, inflation has become the main stressor for Americans in retirement planning, which involves planning medical bills with age.
“As the price of health services and food reaches record highs, Americans have been forced to make difficult decisions that sacrifice their health and well-being,” he said. Kristy Rodriguez, senior vice president of the Nationwide Retirement Institute. “While these decisions are understandable, these short-term trade-offs can have long-term repercussions. Neglecting your health now can lead to much greater costs as you age and approach retirement. Now is a critical time to consult with a financial professional to create a plan that prioritizes health care and prepares you for access to the health services you will need in retirement. “
More than one in ten Americans (12%) say they have canceled or changed their health insurance coverage this year, and another 14% say they are considering canceling or changing their health insurance as open enrollments approach. end of year.
At the same time, 10% say they have already diverted funds from their pension savings to pay for health care costs, by cutting contributions or withdrawing withdrawals from pension plans. On a positive note, even more claims to have initiated or increased healthcare savings account (HSA) contributions in the past year and another 14% are considering it. This allows people with highly deductible plans to set aside pre-tax money to pay for qualifying medical bills.
One area of potential relief for those already 65 and older is reviewing their Medicare plans during open enrollments, which run through December 7. According to the National Council on Aging, only about 10% of people change Medicare plans each year during open enrollments, which could mean they’re overspending on coverage they don’t need or use.
Nationwide is urging financial professionals to emphasize health care cost planning when working with clients: Nearly three-quarters (72%) of Americans say soaring health care costs are one of their main fears about retirement, but only the 39% say they have a plan to pay for their health care costs in retirement.
“The role of financial professionals in creating safer financial futures for their clients is even more important during high inflation,” Rodriguez said. “By incorporating health care into financial planning conversations, financial professionals can help clients better prepare.”
For more information on the Nationwide Retirement Institute’s 2022 Retirement Healthcare Cost Survey, visit www.nationwide.com/healthcareinsights.com.
ppLoadLater.placeholderFBSDK = [ '