Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTDrew WoodWed, July 1, 2026 at 1:14 PM GMT+2 5 min readQuick ReadCovering a typical $6,000 annual Medicare stack requires $150,000 at a 4% yield or just $60,000 at 10%, using the formula: annual cost ÷ yield.High-yield portfolios paying 10% risk principal erosion and distribution cuts, quietly spending down assets while nominally covering the Medicare bill.A 4% dividend growing 7% annually eventually outpaces rising Medicare costs, while a flat 10% yield loses ground to healthcare inflation each decade.Many financial professionals are salespeople paid on what they push, not whether you end up wealthier. A fiduciary is the opposite. The SEC legally requires them to put your interests first. Advisor.com's free matching tool pairs you with vetted fiduciaries from firms like Vanguard, Empower, and Edelman — in under three minutes. See who you match with today.The standard Medicare Part B premium climbed to $202.90 a month in 2026, up from $185 in 2025. Add a Part D drug plan and a Medigap supplement, and many retirees are spending thousands of dollars every year simply to maintain coverage. Unlike a mortgage, this bill never gets paid off. The question is how much capital it takes to generate enough income to cover Medicare costs indefinitely.PeopleImages / Shutterstock.comThe Number to CoverA reasonable middle-ground target for an annual Medicare stack (Part B, Part D, and a Medigap supplement) is roughly $6,000 a year, or $500 a month. Lighter coverage runs $3,000 to $4,000. Higher earners pulled into IRMAA surcharges can push past $8,000 to $12,000. Use the $6,000 figure as the working baseline. The math scales linearly if your stack is different.The core equation never changes: annual cost divided by portfolio yield equals capital required.Conservative Tier: 3.5% to 4.5%This is the dividend growth and broad-market yield zone, with the 10-year Treasury currently anchoring it at 4.5%. Think dividend aristocrats, total-market index funds with rising payouts, investment-grade corporate bonds, and intermediate Treasuries. At 3.5%, covering $6,000 requires about $171,429. At 4%, the number drops to $150,000.Are You Ready To Retire, Or Years Behind?Most Americans suspect they're behind on retirement and never find out.