Displaying items by tag: healthcare

By 2040, adults retirement age are expected to make up 22% of the U.S. population, creating new investment opportunities in sectors catering to an aging demographic. One promising area is medical outpatient buildings (MOBs), which are increasingly in demand as healthcare systems shift toward outpatient care to provide more flexible services. 

A notable example is KKR & Co.'s partnership with Healthcare Realty Trust, which has already committed nearly $500 million to acquire and develop MOB properties. 

While Healthcare Realty Trust has faced challenges, including tenant bankruptcies, it has made strides in improving its financial stability and expanding its portfolio. With favorable demographic trends and a focus on outpatient facilities, the company may have a strong runway for future growth despite current market volatility.

Finsum: This is innovative thinking and could prove a useful way to invest in healthcare.

The U.S. is seeing 30-year records on inflation, and whole generations of American’s have never seen inflation this high. Even worse inflation is even more elevated for healthcare services. Healthcare inflation is expected to be nearly 12% for the next two years according to HealthView Services. This could be a huge hole in retirement savings as a couple of retirees today can expect to spend over $85k on healthcare, those retiring in a decade over $160k and those in the next two decades just shy of $260k. Moreover, social security won’t be enough as the cost of living adjustment doesn’t track healthcare inflation or even standard inflation. Meaning healthcare costs will eat away at most of Social Security.

Finsum: HSAs are more valuable than ever given these ridiculous healthcare inflation costs.

Covid has forever changed lots of industries but one of the most apparent is healthcare. Incidents for the chronic and specifically geriatric population are growing at an alarming rate and will significantly benefit from an increase in at-home care. The current at-home healthcare market is around $3.2 billion but growing at a 13.4% CAGR by projections will move this to a $7 billion industry over the next 4 years. This isn’t limited to just domestic products an aging population is driving rapid growth across Europe and Asia as well.

FINSUM: It makes sense that healthcare will move more at home. Software and digital products will improve the healthcare many in treatment will have access to inside their own home.

Inflation is a concern for retirees, but they should be more concerned than ever becauseSocial Security is tracking the wrong index. Currently Social Security bases its cost of living adjustments on the consumer price index for Urban Wage Earners and Clerical Workers (CPI-W). However, the CPI-W doesn’t fully account for the costs of healthcare and housing that burden retirees more than other groups. Instead social security should track the Consumer Price Index for Elderly (CPI-E) because this is the demographic they are targeting. Research shows that the average social security account since 1983 is in a 0.2% compounded deficit. The rate of inflation for healthcare is slowing which could end up benefiting retirees moving forward but that's just a prediction.

FINSUM: Social security won’t be keeping up with your healthcare costs and investors should augment their portfolios to compensate.

Investors need to be more active with their finances and taxes as they enter retirement because it's not the time to coast as many presume. One of the areas retirees underestimate the costs of retirement and permanently puncture their safety net is in healthcare. Hefty premiums hit most Americans due to the Affordable Care Act once you hit 50, and most Americans who retire before Medicare will face a shocking bill. There are lots of healthcare tax credits available for those with low and middle incomes, and bigger benefits if healthcare costs breach 7.5% of adjusted income. Finally, Roth conversation ladders will dramatically impact your healthcare costs.

FINSUM: It’s critical to be informed about all of the tax benefits those approaching or entering retirement can take advantage of pre-Medicare.