Here's a figure that may make you sick if you are planning to retire soon and haven't looked at what your health care costs are going to be.

If you are 65 and retiring this year, you will need about $130,000 during retirement to cover your health care expenses. For a couple, the total is about $260,000, according to an estimate reported this week by Fidelity Investments.

That has to be a shock for many people close to retirement.

According to the U.S. Government Accountability Office, about half of people close to retirement have no retirement savings. Among those who have savings and are within 10 years of retirement age, half have accumulated no more than $104,000 in savings.

Another 15 percent of near-retirees have $500,000 saved. If you are among them, you might be gasping now: Clearly $500,000 looks puny when you assume that you will have to use $260,000 of it to pay for insurance for doctors and hospitals, and extras like dentists, glasses and medicine.

If you think you can shave something off those costs, it's not likely. Fidelity bases its estimate on what people must pay each year to get Medicare and the additional medical costs that aren't covered by Medicare.

Some people assume Medicare is free, but it's not. The average person will pay $107.60 a month next year for the monthly premiums the government charges to get Medicare doctor and hospital coverage, or what is known as Medicare Part B. Then for drug coverage, the average monthly cost will be $40.66, according to a recent Medicare trustees report.

But even after paying all of those charges, you will be far from done. Medicare pays only part of medical costs, so besides paying for their Medicare, retirees need to buy supplemental insurance policies. They are called Medigap and average about $180 a month. And you aren't done with costs after that, either. There are additional out-of-pocket expenses for medicine, dentists, eye doctors, glasses, hearing aids at $5,000 a pop and a lot more.

The average retiree gets about $1,350 a month from Social Security.

Since 2002, each year Fidelity has looked at current medical costs and the way they have been growing. With that, the investment firm has estimated what retirees are likely to have to pay in the years ahead. Fidelity's estimates are generally considered reasonable among financial planners.

With health care costs and life expectancy both rising, this year's estimate is about 6 percent higher than last year's and about 14 percent higher than 2014's. Fidelity Senior Vice President Sunit Patel said the estimates assume health care costs will rise 4 to 5 percent a year. That's higher than the recent 2 percent average between 2010 and 2015, but lower than the 6 to 8 percent that preceded the recent slowdown in costs, he said.

"The truth is no one knows with certainty what will happen over 22 years," said Patel, although the estimates help people plan.

Fidelity assumes a person will retire at 65 and live to the average retirement age calculated by actuaries. That's 85 for a man and 87 for a woman. Because women tend to live longer than men, women should assume higher total health care costs over their retirement years. Consequently, a single woman might expect to pay $135,000 for health care during retirement and a man $125,000, according to Fidelity.

Longevity is one reason why women must be especially attentive to savings and calculating retirement needs. They can face shortages of savings late in life after devoting large amounts to care for ill husbands.

One major cost that is not woven into Fidelity's health cost estimate is long-term care insurance, which helps elderly people pay for nursing assistants when they can't walk, are recovering from surgery or going through treatment for a long illness such as cancer. Currently, a daily cost of $250 is common for such care, possibly totaling about $90,000 for a year. Medicare doesn't pay any of it.

Fidelity estimated that a couple would need an additional $130,000 to pay for a long-term care insurance policy that would provide $8,000 a month during three years of care. The estimate assumes inflation adjustments in monthly benefits.

"Not everyone needs long-term care insurance," said Patel. It depends on variables such as the amount of money you could devote to the care if needed and whether family members could care for you. People who want the insurance, he said, should get it around age 50 because by 65 health conditions such as osteoporosis, diabetes or heart trouble could make people ineligible.

gmarksjarvis@chicagotribune.com

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