Indonesia faces rising medical inflation and retirement financial challenges

Rising healthcare costs are becoming a significant challenge for long-term financial stability in Indonesia. Medical inflation in the country is projected to reach 17.8 percent by 2026, significantly outpacing the general inflation projection of approximately 2.5 percent.

This trend places increased pressure on households, particularly the ‘sandwich generation’—productive-age individuals who must simultaneously support their children and aging parents. Data from the National Population and Family Planning Board (BKKBN) indicates that 33.98 percent of Indonesian families live with elderly members. Consequently, there is a growing emphasis on early financial planning, including the management of emergency funds and health protection, to mitigate the impact of reduced income during retirement.