Women and Retirement Healthcare Planning

Retirement planning must take into account ever increasing healthcare expenses. This is even more important to women as they must tackle higher healthcare costs as they become older. A report published by HealthView Services has revealed that women spend about 18 percent more compared to men at the same age post retirement.

Less earnings

For women, the problem gets compounded as they earn less compared to men. This gender wage gap means that their post retirement savings must also be stretched further. They have to save on a smaller salary. They also face greater obstacles when it comes to crafting an investment portfolio. For those women who are keen to save for retirement, it is important that they find multiple ways to minimize the impact of healthcare expenses in the unknown future. For them, their target savings must be more than originally envisaged.

According to Terra Bonucchi of Advance Capital Management, women should calculate the amount they should save for retirement and then add an extra 15 percent to the amount. She said that people with a bigger expense figure and more savings enjoy a higher chance of success. They must also evaluate the best place to invest their retirement dollars. Similar sentiments are echoed by Patricia Cathley of Smart Retirement Plan. She advises that women must maximize employer retirement contributions. She recommends that women should adequately invest so that they match the maximum amount to be contributed by their employer. Cathley is specifically keen on the Roth IRA. She said that although the contributor will pay taxes on it today, it is possible to withdraw it tax free at the time of retirement. She adds that it is much more beneficial to pay taxes at the present time as the rates of tax are relatively low. The tax rate could even go lower.

HSA and life spans

If one heeds the advice of Dana Aspach, the founder and head of Sensible Money, another excellent investment avenue is health savings accounts. She says that funds put in any HSA grows without encumbered by tax. The amount can be withdrawn tax free as well when utilized for all qualified healthcare expenses. This provides the women an advantage when it comes to life expectancy. Aspach said as women have a longer life span and are more probable to be single later in their lives, they will be filing at the single tax rates. Tax free fund sources could make a pleasant significant difference.

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