Healthcare spending in retirement is rarely modelled properly, and it lands unevenly across the decades.
Most retirement projections treat healthcare as a flat annual line. In practice the cost curve steepens sharply in later decades.
Premiums, surcharges tied to income, and long-term care each behave differently, and only the first is easy to forecast.
Building a separate reserve for this category, rather than absorbing it into the general withdrawal rate, tends to make the rest of the plan hold up better.
For informational and educational purposes only. This material is not intended to provide, and should not be relied upon for, tax or legal advice. Tax laws and their application vary based on individual circumstances and are subject to change. The availability and potential benefits of the strategies discussed depend on each business owner’s specific circumstances, transaction structure, and applicable law. Consult your tax and legal professionals before implementing any strategy discussed.