Few Americans Preparing for Long-Term Health Care Savings
Only 41% of consumers surveyed understand what long-term health care expenses will be in retirement, and only one-third are confident they are saving at an appropriate rate to cover long-term health care needs.
The majority of health care consumers surveyed by Alegeus are under-funding their health care savings.
Though up 18% from last year, the degree of health care savings discipline scored just 25.9 on a 100-point scale, according to Alegeus’ 2017 Consumer Healthcare Savings Index. This compares to 29.8 for college savings, 41.5 for retirement savings and 41.6 for emergency fund savings.
The index found consumers are starting to become more disciplined about saving for health care, although numbers are still low. Forty-one percent understand what long-term health care expenses will be in retirement, and 34% are confident they are saving at an appropriate rate to cover long-term health care needs.
Thirty-six percent have budgeted to make monthly contributions to their health care savings, and 32% have savings goals to cover long-term health care costs. Thirty percent report they are aggressively saving for long-term health care needs.
To help grow their savings, 29% invest their health care savings in stocks, bonds and/or mutual funds.
Alegeus says the index demonstrates progress in the way consumers manage health care spending and saving, but there is still a long way to go before true consumerism is realized. It “clearly signals the need for significant education, tools and support as consumers assume more financial responsibility for their health care costs.”
The survey included responses from more than 1,400 U.S. health care consumers. The full report may be downloaded from here.