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1 Retirement Expense You Can't Afford to Overlook in 2026

April 13, 2026 — 11:35 pm EDT

Written by

Reuben Gregg Brewer for

The Motley Fool->

Key Points

- The average retiree will spend $172,500 on medical costs throughout retirement, according to Fidelity Investments.

- For a married couple, that number doubles to $345,000, which is enough to buy a house in many markets.

- The $23,760 Social Security bonus most retirees completely overlook ›

The most obvious costs you face in retirement are day-to-day living expenses (food, gas, electricity, etc.). If you move when you retire, housing costs will be at the forefront. What may not jump out at you, however, are the healthcare costs you are paying. But they add up over time, and you should prepare ahead. Here's what you need to know.

How much you can expect to spend on healthcare in retirement

Each person is different and thus has different healthcare needs. So the best you can do going into retirement is to use estimates. There's nothing wrong with using estimates, so long as they are realistic. In 2025, the average healthcare cost in retirement was $172,500 for an individual, according to Fidelity Investments. That was up 4% from 2024, and the number is only going to head higher over time, thanks to the steady beat of inflation.

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For a couple, however, you need to double that number, which leaves you spending $345,000, on average, in retirement on healthcare. That's a huge sum of money, noting that it will be spent over time and not in one lump sum. That's why it is so easy to overlook this cost and focus on things like housing costs. Fidelity's research shows that 20% of Americans have never even considered the healthcare costs they might face in retirement.

Image source: Getty Images.

Medicare won't pay for everything

In the United States, there is a social safety net in the form of Medicare, a government-provided healthcare program for seniors. However, the system doesn't cover all of the costs you'll face. And you'll need to pay out of pocket for Medicare Part B and D. Together, those two monthly expenses make up 44% of Fidelity's cost estimate.

Then there are out-of-pocket costs, such as co-payments and deductibles. Those account for 47% of Fidelity's estimate. The remaining 9% is for prescription costs. All of these costs add up, even though you aren't paying for everything all at once. And if you don't prepare ahead of time, you might find yourself falling short because what you thought you needed to retire was as much as $345,000 less than you really needed.

The real problem is that healthcare isn't an optional expense. You can downsize to a smaller home, eat out less, and take fewer trips to save money, but you can't jump into a new body if the one you have breaks down for some reason. If you fall ill, which is inevitable as you age, you will need to address the problem. So if you are thinking about retirement in 2026, make sure you consider the sizable healthcare costs you'll face over the rest of your life. If you don't, you could end up shocked by the future expenses you have to deal with.

The $23,760 Social Security bonus most retirees completely overlook

If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income.

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View the "Social Security secrets" »

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