Retirement and health care: Striking a healthy balance?
We hear it all the time: life expectancies in Canada are on the rise. Although this is good news, financial considerations can cast a bit of a shadow over this happy picture. The older we get, the more we face health problems of all sorts, and they may prove costly, particularly because medical costs could continue to rise. So it is important to be prepared.
Charles de Kovachich: Investment Advisor
Quebec's health and medication insurance plans cover many health care services, but some types of care - in particular, long-term care - are not necessarily covered by the state. Furthermore, in a context where elderly people represent a growing segment of the population, the ability of our governments to cover rising health care costs is cause for concern. There is therefore some uncertainty surrounding the future of health care costs and which expenses will be covered by the state, particularly if your retirement is farther down the road.
So it's important to consider possible health problems you may encounter in retirement, and ask yourself if you will be financially ready to face them. Should major health problems arise, you may need to dig into some of your savings to assume the costs of required care, placing your financial security and lifestyle at risk. Although long-term care and critical illness insurance were developed to address such problems, very few people on the verge of retiring take out this kind of protection, even though it could provide peace of mind. As with everything else, you should assess the need for such coverage by estimating your needs as realistically as possible.
In closing, I cannot emphasize enough the need to become well informed about the different health protection packages that are available and identify the ones that meet your needs. Your financial security and lifestyle in retirement depend on it. To your health!
Charles de Kovachich
National Bank Financial