Retirees’ overall confidence in their ability to continue to cover basic expenses is on the decline, according to the latest Employee Benefit Research Institute’s Retirement Confidence Survey. One major problem: More than four in 10 retirees report that their health care expenses are higher in retirement than they planned for.
More than any other category of expenses, health care costs have taken retirees by surprise. The 44 percent that say health care costs are higher than they planned for compares to 26 percent who said housing costs are higher than they planned for. And 27 percent said their overall expenses are higher than planned for.
Retiree confidence tends to track with the economy’s performance. In 2009, as the economy was climbing out of recession, only 20 percent said they were very confident in their ability to survive retirement comfortably. The number peaked in 2016 at 39 percent. But this year, despite a strong economy, the number of very confident retirees has dropped back to 32 percent.