Planning for retirement means thinking beyond your monthly income. One expense that’s easy to underestimate is healthcare.

A 65-year-old retiring in 2026 can expect to spend an average of $185,500 on healthcare during retirement—a 7.5% increase from last year’s estimate, according to a CNBC report on Fidelity Investments’ 25th annual Retiree Healthcare Cost Estimate. That total includes Medicare premiums and out-of-pocket costs for medical care and prescription drugs, but it doesn’t include long-term care.

The good news?

Knowing what to expect can help you plan.

If retirement is a few years away, you might have opportunities to reduce future healthcare costs. As MarketWatch recently noted, delaying retirement until you’re eligible for Medicare at age 65—or even working a few years longer if it fits your plans—can help you avoid the higher cost of buying private health insurance before Medicare begins.

Other smart planning includes contributing to a Health Savings Account (if you’re eligible), learning what Medicare does and doesn’t cover, and building healthcare expenses into your retirement budget from the start.

Once you’re enrolled in Medicare, it’s also important to review your coverage every year during the Annual Enrollment Period. Your healthcare needs, prescription drug costs and available plan options can change over time, and an annual review can help ensure your coverage continues to meet your needs.

How are rising healthcare costs affecting you or your family? Share your experiences, concerns and ideas with us. Your voice can help shine a light on the challenges consumers face and why affordable healthcare matters.

###