I have diabetes. What health-related costs should I be planning for before retirement?

Q: I’m managing diabetes and hoping to retire in 10 years. What health-related costs should I be planning for?

We asked Joseph Taylor, adviser at Sunlife, to answer this one.

November is National Diabetes Awareness Month in Canada, so this question is timely. Diabetes affects nearly 10 per cent of Canadians, and those with the more common Type 2 diabetes – which usually develops later in life – make up approximately 90 per cent of that cohort. Simply aging is one of the biggest risk factors for developing Type 2 diabetes, so it’s important to understand what you can do to better plan for it.

According to Mr. Taylor, when preparing for retirement while managing diabetes, you should consider not only today’s health-care expenses but how your needs and coverage could change over the next 10 years.

“Start by understanding what you’re spending today on medications, insulin, blood glucose monitoring supplies, medical devices and appointments,” he said. “Costs can vary considerably depending on whether you have Type 1 or Type 2 diabetes and your individual treatment needs. Think about how those expenses could change as you approach retirement.”

Just as importantly, Mr. Taylor advises his clients to review what they’re paying out of pocket today versus what is covered through their current employment insurance benefits plan.

“Will that coverage continue when you retire, or will you need to consider provincial programs, personal coverage or your own savings to help cover costs? Provincial health-care and drug coverage vary, including benefits available at age 65,” he noted. “Check what your province covers, any deductibles or limitations and whether you could face a coverage gap if you retire earlier.”

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Mr. Taylor recommended that it’s also worth exploring government programs that may offset some expenses. “In Ontario, for example, the Assistive Devices Program (ADP) may help eligible individuals cover the cost of certain diabetes-related equipment,” he said. “The Canada Revenue Agency’s (CRA) Disability Tax Credit (DTC) may provide tax relief for people who meet the eligibility criteria. Having diabetes doesn’t automatically qualify someone for the credit, so it’s worth exploring what may be available based on your circumstances.”

Retirement planning should also account for the possibility of future health changes. “Health-care needs and expenses often evolve over time, particularly as we age,” Mr. Taylor said. Depending on your circumstances, diabetes may also increase the likelihood of needing additional treatment, support or care in the future. “Building flexibility into your plan can help you prepare for costs that may not be part of your budget today.”

Finally, Mr. Taylor suggested that you consider the impact of a health event before retirement. If diabetes or another condition affected your ability to work, would your plan stay on track? “Reviewing existing disability, critical illness and life insurance can help identify gaps. Having diabetes doesn’t automatically make additional insurance unavailable, although eligibility and costs depend on individual circumstances.”

How to plan for retirement when your goals don’t match your spouse’s

Ultimately, retirement planning isn’t just about finances, he said. It’s also about maintaining your quality of life, and that includes your mental health and social well-being. Living with diabetes can increase the risk of depression and anxiety, while retirement may bring changes to your daily routines and social connections.

“It’s important to budget for activities that keep you active and engaged, whether that’s joining a community group, pursuing a hobby or taking a fitness class,” he added. “Staying connected doesn’t always cost much – meeting friends for coffee, walking together or volunteering can make a difference in supporting your overall well-being.”

With 10 years to prepare, Mr. Taylor said that you should take this time to develop a strategy. “Working with a financial adviser can help you understand your future health-care costs, maximize available benefits and build a retirement plan that supports both your financial security and quality of life.”

Do you want advice on a financial planning or retirement issue that’s affecting you? Send us an e-mail.