Healthcare Cost Planner

What’s the retirement expense people underestimate the most? Healthcare, and it isn’t close. The premium is the part everyone sees and the small part of the real bill. This planner is a worksheet to add up the whole thing, the visible costs and the ones that ambush you, so the number in your plan is honest.

Medicare is not free and it is not complete. People hear “I’ll be on Medicare at 65” and assume the problem is solved. Then the deductibles, the drug costs, the dental and hearing gaps, and the income surcharges show up one by one. The planner makes you face all of it on one page.

What the worksheet adds up

Five buckets, summed to an annual and a lifetime estimate.

• Premiums. Part B, a Medigap or Medicare Advantage plan, and a Part D drug plan. For 2026 the standard Part B premium is $202.90 a month per person.
• Out-of-pocket. Deductibles, copays, and coinsurance. The 2026 Part B deductible is $283.
• The gaps. Dental, vision, and hearing, which traditional Medicare mostly doesn’t cover, plus anything for care while traveling.
• The surcharge. IRMAA, the income-based add-on to Part B and Part D. For 2026 it starts above $109,000 of income for a single filer and $218,000 for a couple, and it climbs in tiers from there.
• Long-term care. The big one, and the one most plans ignore until it’s urgent.

The bridge years, if you retire before 65

Leave work at 62 and you’ve got a coverage gap until Medicare. That stretch, on COBRA or a marketplace plan, is often the most expensive healthcare of your life, and the planner gives it its own line. Size it honestly against your options in COBRA vs. marketplace coverage before you set a retirement date.

The surcharge is a planning lever, not a fixed cost

Here’s the move most people miss. IRMAA runs on a two-year income lookback, so your 2026 premium is set by your 2024 income. That delay is the opportunity. A big Roth conversion or a one-time gain can quietly raise your Medicare premium two years later, while careful timing keeps you under the next tier. Your income drives your healthcare cost, which means you have more control over the bill than the premium notice suggests.

Treat long-term care as its own decision

Don’t bury it in a line item. Whether you self-fund or insure is a real fork, and the math deserves its own look at long-term care: self-fund vs. insurance.

Fill this out before you lock a retirement budget. A healthcare estimate that only counts premiums isn’t a plan, it’s a pleasant surprise waiting to turn unpleasant. Count all of it, and the rest of your numbers get trustworthy.