2 Retirement Risks Affluent Americans Often Overlook

Core Insights - A significant majority of affluent Americans (89%) are confident in their ability to cover essential expenses in retirement, yet many fail to consider critical risks such as inflation and healthcare costs [1][2] Inflation Impact - Many mass affluent couples do not incorporate inflation into their retirement strategies, which can lead to faster depletion of assets. For instance, $100,000 in annual expenses in 2020 would rise to nearly $125,000 by 2025 due to inflation [3] - Average inflation rates over 20 years stand at 2.2%, while the five-year average is 2.7%. High inflation combined with market downturns can significantly affect financial plans [4] Healthcare Costs - Healthcare costs are a major oversight in retirement planning, with an additional $600 per month recommended to cover healthcare expenses. However, long-term care can be substantially more expensive, with typical nursing home costs reaching $10,000 per month [5][6] - Only 53% of individuals who discussed retirement with a partner considered inflation, and this number drops to 45% among those who did not have such discussions. Similarly, only 48% factored healthcare costs into their plans, decreasing to 37% for those who did not discuss retirement [6][7]