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GOBankingRates’ editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services – our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines<\/a> and our products and services review methodology<\/a>.<\/p>\n 20 Years<\/strong> Trusted by<\/strong> Insurance costs have skyrocketed since the pandemic \u2014 and show few signs of slowing down<\/a>. That makes it hard to plan for costs in retirement, as the goalposts keep moving.<\/p>\n Keep an eye on these three insurance costs in particular as you plan your retirement<\/a> nest egg.<\/p>\n Supplemental Medicare Coverage<\/p>\n Yes, retirees become eligible for Medicare coverage at 65. However, it doesn\u2019t cover everything.<\/p>\n \u201cThe average American spends nearly $200,000 on healthcare expenses<\/a> during their golden years,\u201d noted Whitney Stidom, vice president of consumer enablement at eHealth Insurance. In fact, a 2025 study by the Employee Benefit Research Institute<\/a> found that some couples need up to $428,000 to have a 90% chance of covering their healthcare costs in retirement.<\/p>\n<\/p>\n A new survey from eHealth<\/a> found 76% of people underestimate (or don\u2019t know) the average cost of healthcare in retirement. \u201cEnrolling in Medicare Advantage is often affordable, and will limit maximum out-of-pocket costs for the year,\u201d said Stidom. \u201cPlus, most Advantage plans come with prescription drug coverage. Some Medicare Advantage plans come with special benefits like discounted gym memberships<\/a>, coverage for over-the-counter drugs and more.\u201d<\/p>\n To help prepare in advance for unpredictable healthcare and supplemental Medicare coverage costs, consider opening a health savings account<\/a> (HSA). They offer the best tax benefits of any tax-advantaged account, as you can deduct the contributions, they compound tax-free, and you pay no taxes on withdrawals.<\/p>\n Long-Term Care Insurance<\/p>\n Medicare doesn\u2019t cover long-term care<\/a> \u2014 but it gets expensive, and fast. The \u201c2025 Trends in Retirement Planning\u201d study by the Journal of Financial Planning<\/a> found that 40.7% of retirees carry long-term care insurance, and 44.9% pay for a rider on other insurance products.\u00a0<\/p>\n Unlike working people, retirees can\u2019t increase their income to offset rising costs. When insurance rates go up, retirees have to cut spending elsewhere to stay afloat \u2014 which can quickly downgrade their quality of life.<\/p>\n Homeowners Insurance<\/p>\n The last few years have not been kind to homeowners<\/a> insurance clients.<\/p>\n \u201cCurrently the average homeowner is paying $2,802 for home insurance,\u201d explained Susan Meyer, insurance analyst at The Zebra<\/a>. \u201cIn 2024, the average was $1,602 for the same coverage \u2014 a 74% increase in only a year.\u201d<\/p>\n<\/p>\n Granted, most homeowners aren\u2019t actually paying 74% more for their policies after just one year. Many have downgraded coverage or increased their deductible just to afford policies at the new rates.<\/p>\n Homeowners insurance may play a larger role in where Americans choose to retire in the coming years<\/a>. Already, three of the four states with the oldest populations (Maine, West Virginia, Vermont and Florida) have below-average homeowners insurance premiums. Meyer noted that the exception, Florida, has an average premium of $3,333 given the high frequency of storm damage.<\/p>\n![\"\"](\"https:\/\/cdn.gobankingrates.com\/wp-content\/uploads\/2023\/11\/icon-20.svg?webp=1&quality=75\"){kind=icon}
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