These Surprise Expenses Can Derail Your Retirement Budget
You’ve planned and saved all your life and finally hit retirement, so now it’s time to relax, right? Nope! A lot of folks are surprised by the sneaky expenses that pop up once the paychecks stop coming in. Here are some of the most common problems people run into.
Healthcare and Wellness
You might assume Medicare covers everything, but don’t count on it. There’s so much expense. Co-pays, dental care, prescriptions, and even “little” things like glasses or hearing aids add up really fast. Unfortunately, it’s just a fact that Americans have to pay a lot to lead a healthy life, especially older Americans.
Home Maintenance and Modifications
When you stop working, you suddenly have time and motivation to fix things around the house and make it better for you in old age. Unfortunately, it’ll cost you. Putting in wheelchair ramps or grab bars for accessibility, plus unexpected breakdowns (like a leaking roof) can cost retirees way more than they expected.
Home and Car Insurance
Think your premiums will go down once you retire? Maybe, but not always. Rates can creep up due to inflation, claims history, or even changes in where you live and how often you drive. Review your policies yearly and always ask about senior discounts. Luckily there are lots of people whose job it is to help you.
Travel
One of the biggest perks of retirement is finally having time to travel, but it can get expensive fast. Flights and hotels aren’t cheap, and don’t forget those unplanned visits to see the grandkids. To avoid draining your savings by accident, build a dedicated travel budget and hunt for senior discounts.
Transportation
Even if you’re no longer commuting to work, transportation still costs money. And if you stop driving, rideshares and taxis aren’t always cheap either. It’s easy to underestimate how much you’ll still spend getting around, so make sure your retirement budget includes wiggle room.
Utilities
You might think your utility bills will shrink in retirement, but if you’re home more often, they can actually go up. Think of how much you use your heating during extreme weather months. You really need to keep a firm eye on your utilities and see where you can cut back.
Kids and Grandkids
Retirement doesn’t stop you from wanting to help out your family - but those little (or big) gifts can really add up. So many people have paid towards their grandkids’ college funds, for example, and soon found themselves seriously badly affected money-wise.
Taxes
Many retirees are surprised to find taxes still take huge bites out of their savings. Social Security benefits, pension income, 401(k) withdrawals, and even part-time work can all be taxable depending on the state, unfortunately. Property taxes may also rise over time. Why not hire someone to help you sort it all out?
Moving
A lot of retirees plan to downsize or relocate for the sake of their bank accounts - but moving isn’t cheap. Even just hiring movers to load your furniture into a van is more expensive than some people realize. You really have to think about it before you move.
Staying Connected
Just keeping up with the crowd is expensive these days. Between your phone plan, internet, and streaming services, you could be spending more than you think just to stay in touch with your grandkids and the entertainment world. One thing you definitely need to do is check your outgoings every month to make sure you’re not spending money on a streaming service you’re no longer using.
