Recent changes in health care policy stemming from the enactment of the Affordable Care Act have put a spotlight on the rising cost of health care in the United States. Around the country, Americans are sorting out how much money they need to set aside to cover health care related expenses, and how they’ll keep pace with future increases.
For individuals nearing retirement age, this issue is particularly important. According to data from the Employee Benefits Research Institute,* a baby boomer couple retiring in 2020 will spend an average of $227,000 on medical expenses in retirement. The total cost for an individual can vary dramatically.
There are numerous dimensions to the connection between current and future health status, health care costs and finances. The Health, Wealth and Retirement study digs deeper into how baby boomers perceive these connections and which lifestyle and financial steps they are taking to help prepare. View More
But when it comes to household finances – saving for retirement, managing budgets and making insurance and investment decisions – how are women involved, and what motivates their role in making financial decisions? That is what the Women and Financial PowerSM study set out to understand. The data uncovered that nearly every American woman surveyed is influencing these decisions or making them on her own; and those women nearing retirement, one of life’s biggest milestones, are most engaged in and confident about their finances.
Americans juggle multiple financial goals through various life stages, but it can be a challenge for many to strike a balance between pursuing short-term needs and wants while saving for the future. People of all ages and incomes make lifestyle choices that affect their immediate financial situation — and often these decisions have long- term effects.
We conducted the Financial Trade-Offs study among three generations of Americans to discover which financial needs and goals they prioritize, and which trade-offs they consciously make to meet these goals. What we found is that most people say they are generally willing to make trade-offs today in order to save for tomorrow. However, their financial actions — and the bills they have yet to pay — suggest they may not always be thinking about what will have the biggest long-term impact.