Worried about the effects of rising healthcare costs on your retirement plans in Springfield? In 2026, healthcare is poised to take an even bigger bite out of retirement budgets. While Social Security’s projected cost-of-living adjustment (COLA) will rise by 2.7%, Medicare Part B premiums alone are expected to increase by 11.6%—more than four times as fast.
For many retirees in Springfield and across the country, the math doesn’t add up. Let’s talk about how healthcare and long-term care costs can shape your future goals.
Why Healthcare Costs Are Rising Faster Than Retirement Income
According to health policy experts, Medicare Part B and D premiums and cost-sharing now consume nearly a quarter of the average monthly Social Security check. And that’s before factoring in expenses Medicare doesn’t cover: things like dental work, eye exams, hearing aids, and long-term care. Between 2010 and 2024, COLAs increased benefits by 58%, but retiree expenses rose 73% over the same span. Simply put, Social Security isn’t keeping pace with the true cost of aging.
And the long-term care side is where things get even steeper. New research shows that a 65-year-old who retired in 2025 may need anywhere from $172,000 to over $300,000 in healthcare funds over the course of retirement. Nursing home costs are climbing fast—now averaging nearly $127,500 per year for a private room. Assisted living facilities jumped 10% in cost from 2023 to 2024. All of these increases rarely come with much warning. So, how can Springfield retirees prepare? Here are a few strategies to potentially discuss with your financial advisor:
- Segment Your Retirement Buckets: Consider carving out a dedicated healthcare fund separate from your general retirement savings. That might include using an HSA during your working years or earmarking a portion of investment income for future out-of-pocket costs.
- Plan Beyond Medicare: Original Medicare doesn’t cover every need. Supplemental coverage (like Medigap), long-term care insurance, or hybrid life/long-term care policies may provide extra flexibility when care needs increase.
- Reassess Annually: As Medicare premiums and long-term care costs shift, consider revisiting your retirement income strategy regularly. Even small cost changes can affect your drawdown plan or required minimum distributions.
- Look at Income Sourcing and Tax Positioning: Coordinating how and when you pull from different accounts—tax-deferred, Roth, or brokerage—can help cover growing expenses more efficiently while limiting tax exposure.
Consider Talking with a Springfield Advisor About Healthcare Planning in Retirement
At LaTour Asset Management of Springfield, we believe that financial peace of mind in retirement starts with a clear path.
Rising healthcare costs can’t be avoided, but they can be planned for and managed wisely with an appropriate strategy. If you’re in or near retirement and want more confidence in your long-term retirement planning, call us today at (877) 888-5724.
