Retired millionaires worry more about taxes than they do about any other expense, including medical bills.
Securian Financial Group Inc., a unit of Minnesota Mutual Insurance Companies Inc., St. Paul, Minn., has published that finding in a summary of results from a survey of 225 retirees conducted by the Spectrem Group, Chicago. Survey participants were ages 70.5 to 75, with a net worth of at least $1 million.
Personal income tax expense was the participants’ highest average annual expense, according to Spectrem researchers. Survey participants reported paying an average of $25,226 in personal income taxes per year. Income taxes, real estate taxes, capital gains taxes and personal property taxes amounted to a combined average of about $40,600 per year, or 4% of the participants’ net worth, the researchers found. Health-related costs averaged $6,681 per year.
The average survey participant spent more on travel, cars, charity, travel, food, gifts and mortgage payments than on health care. Before retirement, about one-third of the participants had expected their biggest post-retirement expense to be health care. Once the participants retired, however, health care expenses accounted for an average of just 12% of their expenses.
Other survey findings:
–About 88% of the millionaires cite the “security and well-being of our country” as their greatest concern.
–28% of the participants said they switched advisors when they retired.