by
Carl Hampton
10/09/2007 
Fast Forward: 2019; the hospital
insurance fund is projected to run out of
funds. 2041; the Social Security Trust Fund
will run dry.
The hospital insurance funds of Medicare
(Government health care program) are
currently paying out more than it takes in.
It is projected that Medicare’s payments
for doctors and prescription drugs will rise
faster than the nation’s overall economic
growth. Therefore, causing beneficiaries’
premiums, co-payments, and deductibles to
rise faster than their incomes!
As a retiree, it is assumed that Medicare
(if you are eligible) will cover most of
your health care costs. Though, if we are to
believe that the Social Security and
Medicare systems are in such a state, we
best be prepared to bear potentially major
health care costs.
It is estimated that a couple, aged 65
years, will spend in excess of $200,000.00
over the next 20 years on health care; even
if they are covered by Medicare!
Consider this: if you are aged 65 years (or
older), it is highly probable that you may
need dental care, eye glasses, hearing aids,
regular check-ups; at some stage, possibly
even long-term nursing home care. Do you
know that apart from ONE free check-up when
you first enroll with Medicare, these
services are not covered?!
Social Security was created in 1945. By
1955, 42 workers paying the system paid for
ONE retiree. In 2007, they are paying for 3.
By 2030, every working couple will have
their very own retiree to support! Thus, the
significant, and rising, imbalance between
workers and beneficiaries.
There are 2 issues to consider when deciding
“to retire, or not to retire;” life
expectancy, and investment acumen.
If you decided to retire at 62 years of age,
you will receive 75% of full Social Security
benefits each month for the rest of your
life. Wait to retire at age 66, and you will
receive 100%. If you can hold out until you
are 70, you will be paid 132% of your full
benefit.
The bottom line is: soaring medical costs
accompany increased longevity. The Social
Security and Medicare systems seem to be
worsening, not improving. Perhaps, saving
for health care costs, in retirement, means
thinking outside of the box; a health care
mutual fund may be just the prescription for
success?!
