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The Real Cost of Aging in the U.S.

Jeff Anderson
By Jeff AndersonDecember 4, 2018

Last Updated: December 4, 2018

It’s said that it costs a million dollars to raise a child, but how much does it cost to age? No two seniors will face exactly the same challenges of aging, but by looking at the main expenses after 65, we can estimate how much it truly costs to grow old in the United States.

Learn more about the real cost of aging in the U.S.

The Cost of Aging

While every American who turns 65 qualifies for Medicare, seniors can still accumulate significant healthcare costs during their retirement.


Copays, hearing aids, prescriptions and other out-of-pocket expenses can really add up. Fidelity Benefits Consulting estimated the average medical expenses for a 65-year-old couple to be $220,000 for the remainder of their retirement.

Brad Kimler of Fidelity noted:

“It is extremely important that health care costs are factored into retirement savings strategies today so that retirees can be prepared to pay their medical bills throughout retirement.”

Average lifetime costs after 65: $110,000 per individual / $220,000 per couple

Long-Term Care Costs

A study published in the journal Inquiry found that the average American senior will require about three years of long-term care during his or her retirement.

According to Genworth:

  • The average annual cost for an assisted living community is about $48,000 per year
  • The average annual cost for a home health aide is 50,000 per year
  • The average annual cost for skilled nursing is about $89,000 per year

But, we do not advise that you base your assumptions on these amounts. Chronic diseases and illnesses can easily require a senior (or the senior’s loved ones) to spend significantly more than this on care.

If you are trying to analyze potential care costs that your family may be facing, use A Place for Mom’s Senior Care Calculator. It allows you to compare the cost of current monthly expenses to the cost of senior living in your city.

Average lifetime costs after 65: $50,000 per individual / $100,000 per couple (based on figures from Inquiry study adjusted for inflation)

Living Expenses

While in retirement our income may drop, but our expenses do not.

According the Bureau of Labor Statistics, the average cost of living for an American is $20,194 per year (or $50,485 for the average household). This includes costs such as food, housing and transportation.

The average lifespan in the United States is 79 years. This means a 65-year-old couple would require about $565,000 to cover their basic living expenses during retirement.

Unlike health-costs and long-term care costs, living expenses have an element of predictability to them. Rather than relying on the nationwide average, retirees can estimate their own expenses based on their circumstances to get a closer picture of the amount of money required to cover their cost of living.

Average lifetime costs after 65: $282,000 per individual / $565,000 per couple

Overall Retirement Costs

The sum of these three broad categories of retirement expenses allows us to gauge the overall cost of life after 65, which is:

  • $412,000 for an individual
  • $824,000 for a couple

But, remember that the cost of aging also depends on a number of factors that can be unpredictable:

  1. In a market economy, prices never stay stagnant for long. Retirement experts advise that seniors assume inflation will be at least 3% annually. At this rate of inflation, costs double every 24 years.
  2. Inflation represents the average increase in all costs over time, but health care costs are rising at a rate more rapid that inflation. While average healthcare costs for retirees are decreasing, the trend is for increasing healthcare costs overall.

What’s more, these figures are based on the largely unpredictable factor of lifespan. A longer lifespan means more costs. It’s not unreasonable to expect life expectancy to increase with advances in medicine and technology, and as American society becomes more focused on healthy lifestyles. While the average life expectancy is 79, most people hope to live beyond 79.

Planning for the Costs of Aging

While these figures give us a good picture of what retirement may have in store for us, and the costs that a typical retiree faces, it’s important not to allow the word “average” or “median” to lull you into complacency. If the average 65-year-old couple’s health expenses are $220,000 during retirement, there is naturally a very good chance that such a couple would have more than $220,000 in expenses. Don’t assume that your expenses will be merely average. Plan for the unexpected and use averages and medians to reckon the minimum amount of preparation and saving that’s required to retire prudently.

If you are undertaking a project to estimate how much you or a loved one may need for retirement, you can base your estimates on your particular circumstances for a forecast that’s more accurate.

Basing estimates of retirement costs on your own cost of living rather than the national average will allow for more accurate estimates.

You should also consider taking into account regional cost differences.

An excellent tool to help with a personalized estimate of retirement costs is the AARP Retirement Calculator, but you don’t have to do it yourself: If you are unsure about your retirement plans, consider speaking with a financial advisor who has an expertise in retirement planning.

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