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INVEST & SAVE | Retirement

How to plan for medical expenses in retirement

Momentum Investo

5 MIN READ

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A healthy young couple playing soccer with their two children outside.

Many people don’t save enough for retirement. They’re in for a huge surprise regarding the medical expenses during retirement, too.

Inflation has this habit of carving into savings and spoiling the fun. And medical inflation is even higher than normal inflation, up to 3% higher. We look at how rising healthcare costs in South Africa affect your retirement and share tips on how to beat the rising inflation during retirement.

If this is your retirement plan, think twice:

Inheriting from a rich relative.
Relying on your kids.
Winning the Lotto.

How rising healthcare costs in South Africa affect your retirement

The impact of inflation

A table comparing the rate of rising inflation across bread, milk and medical aid in 1980, 2024 and 2050.

* Based on consumer price index (inflation) of 5,5% and medical aid inflation of 8,5%.

Source: Stats SA, as quoted by BusinessTech: Here’s what you could buy for R100 in South Africa 30 and 60 years ago.

Increased medical claims

Some people think that they can lower their medical aid plan during retirement. The reality is that medical claims only increase.

This is the picture:

A graph showing the rise of medical claims by age group.

Source: Momentum Health Solutions claims statistics
(Cost per policy per month)

Investing tip:
The only way to beat inflation is to start saving early so that your money can grow faster than the inflation rate.

Beat medical inflation with a separate retirement annuity (RA)

Take control of your future by securing an extra retirement annuity for medical expenses—you won't regret it. If you already have an Investo Retirement Annuity, you can start a second one for as little as R150 per month. Enhance your fund value by adding single sums or increasing the monthly contributions to your current retirement annuity.

We’re all looking forward to that time that sounds so romantic:

No getting up early.

No going to work or switching on the computer.

Long walks and lots of hobbies.

Retirement doesn't have to be daunting. By starting to save early, you'll be amazed at how the power of compound interest can grow your money. Not only does your investment increase, but you also start earning interest on the interest, creating a magical multiplier effect. Embrace this opportunity and watch your future flourish.

A young woman sitting on a couch with a paper and calculator, calculating her expected retirement funds in her retirement annuity when she retires.

Take the first step towards a worry-free retirement. Learn more about our retirement annuity and the two-pot system to maximise your savings.

Get advice

Secure your future. Speak to an adviser and take control of your retirement. Enjoy peace of mind — start planning for a worry-free retirement today!

Find an adviser Request a call back

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How to plan for medical expenses in retirement

Momentum Investo

5 MIN READ