January 26, 2017 – It’s no secret that women pay more for many things—compare the prices of women’s drugstore products to men’s and the difference is obvious. But did you know women will also pay more for healthcare over their lifetimes? A recent report revealed that, on average, a 30-year-old healthy woman will pay $118,632 more for healthcare over her lifetime than a man. The report was released by HealthView Services, and it’s worth a look—it includes several projections, included expected Medicare costs depending on age, race and health conditions.
More specifically, the report predicts that women who are currently age 30 will likely live to 91-years-old and spend $548,098 on healthcare. Comparably, men will live to 87 and spend $429,466 on healthcare. The difference is attributed to the longer life expectancies of women. Healthcare costs are extremely high in the final years of life, explaining the more than $100,000 difference.
So what does this all have to do with retirement? Those high healthcare costs will be levied on women during their retirement years, at a time when funds are already tight for women who, on average, have less in savings than men. The retirement gap exists primarily because women on average earn less than men during their careers and are more likely to take time off for caregiving. As a result, HealthView Services calculated that women end up with 23% less in Social Security payments than men.
These numbers are a reminder that women need to factor in the growing cost of healthcare as they age into retirement planning. Women are also more likely to need long-term care because of their longer life expectancies. According to a report from Genworth, the cost of that can be very expensive—the average cost of a private room in a nursing home is $92,000 per year and home care costs are on average about $3,500 per month. In addition to greater life expectancies than men, women spend more twice as many years in a disabled state as men do: 2.8 years if they live past 65, 3 years if they live past 80 (American Association for Long Term Care Insurance).
When planning for retirement, it’s extremely important to factor in the high, growing cost of health care in your final years. For more information and resources on health care and retirement planning, including long-term care, visit WISER’s page on health care.