Every May, the Administration for Community Living (ACL) celebrates Older Americans Month (OAM) to recognize older Americans’ contributions, examine aging trends, and demonstrate the commitment to serving older adults. In step with that cause, we’re taking this time to honor older Americans by demonstrating our commitment to helping our clients fulfill their vision of retirement.
In 2026, the ACL’s theme for Older Americans Month is “Champion Your Health.” This theme is an invitation to take charge of your physical, mental, and financial well-being—whether that’s getting your daily steps in, spending more time with loved ones, or leaving a legacy. But to truly champion your health as an older American, look beyond physical fitness and consider a strategy that goes a step further and includes thoughtful healthcare preparation as well.
But you can’t champion your overall health if your financial health may be challenged. Let’s look at how planning for healthcare costs in retirement can help empower you to embody OAM’s core message: to live with dignity, independence, and vitality.
Navigating the Landscape of Long-Term Care
One component of championing your health is learning to balance the desire for a comfortable retirement with the need to manage potential healthcare costs and unforeseen expenses. Understanding the actual costs associated with medical care in your later years is an all-too-common challenge, as many retirees underestimate these expenses. However, misunderstanding them can make retirement virtually unaffordable. For instance, an average 65-year-old retiring in 2026 may require approximately $165,000 to cover healthcare expenses throughout their retirement—and this estimate excludes long-term care (LTC) costs, which can vary considerably based on individual needs.
Because LTC costs aren’t covered by standard health insurance or Medicare, they can be considered a significant threat to a retirement nest egg. The truth of LTC is that it’s a “when,” not an “if,” for about 70% of people over 65. Sometimes it involves aging in place with home health aides, other times it involves transitioning to an assisted living facility. No matter the case, long-term care requires meticulous planning—and without proper planning, you could face higher premiums than if you had started early. Remember, premiums are based on your age and health at the time of application, so you may even be denied entirely.
So, how do you avoid that scenario?
Long-Term Care Insurance
Long-term care insurance covers costs for extended in-home care or facility stays (nursing homes, assisted living) for individuals with chronic illnesses, disabilities, or cognitive impairments like Alzheimer’s. It can be beneficial to apply for long-term care coverage while you might still qualify for preferred rates due to the relatively low risk of needing to use the coverage soon. Locking in lower rates while young and healthy can potentially empower you to facilitate a more dignified lifestyle in retirement.
LTC insurance is unique because of how customizable it can be, meaning you can tailor a policy to your specific financial goals and family situation. For example, some LTC policies include inflation protection features that can help your coverage benefits grow by the time you need to use them—another reason to start while you’re young. If you’re in your 20s, 30s, or 40s, you have a meaningful advantage: time. Unlike a 65-year-old who might invest conservatively, a 30-year-old can invest for long-term care decades before they might need to use it.
Self-Funding Your Long-Term Care
Choosing to self-fund healthcare involves implementing a strategy where you manage the financial risk yourself. If you retire before 65, you aren’t yet eligible for Medicare and thus may be looking to bridge the coverage gap until then. For example, if you required LTC later in life and had dedicated a bucket of your savings and/or investments for that expense during your working years, you could reduce the strain those expenses could have on your financial situation. A dedicated long-term care bucket in your portfolio that’s invested in a strategy aligned to your risk tolerance. This method could potentially turn a modest monthly contribution into a helpful self-insurance fund down the road. But how and where you put those savings or investments is key…
Health Savings Accounts
A powerful way to fund your own healthcare costs is through triple tax-advantaged health savings accounts (HSAs). These offer the ability for your money to go in tax-free, grow tax-free, and be withdrawn tax-free for medical and LTC expenses. You can contribute to an HSA while you’re still working, and, once you turn 65, you can use the HSA funds to pay for Medicare Part B and Part D premiums. In 2026, you can even use HSA funds to cover qualified LTC insurance premiums. But access to these accounts can be stricter as they’re often offered through employers, and you must have a specific kind of health coverage to qualify for opening one.
Going the Distance: Our Commitment to Your Empowerment
As we celebrate Older Americans Month, let’s reframe what it means to grow older. It isn’t just about adding years to life but adding life to years. It’s about vitality. It’s about developing a strategy for independence and self-determination. Successful aging begins long before you reach “senior” status. Retirement planning is a lifelong journey of financial management that requires both foresight and flexibility. If you don’t carefully plan for your healthcare in retirement now, you could end up with a greater financial burden than was necessary. That’s why it’s important to be proactive. Even the most health-conscious individuals might find themselves in need of expensive healthcare services later in life.
But regardless of where you are in your journey toward retirement, there may be more options than you think. So don’t wait. Call us so we can discuss ways to manage your financial strategy and help you pursue your goals in the later years.
