Retirement is a big chapter in your life and is the reward for a lifetime of hard work. What do you plan on doing during your retirement? If you’re here at the Jersey Shore it could mean more time at the beach. For a lot of folks, it means more time to travel the world and spend more time with family. Retirement can be an exciting and validating time. However, it’s impossible to plan for EVERY twist and turn retirement can throw you. With retirements lasting over 30 years nowadays, it’s expected to have some surprises along the way. Here are a few “common” surprises many people experience during their retirement:
Even in Retirement Your Home Will Be a Large Expense
Paying off your mortgage can be a great feeling. While your plans for retirement may be paying off your mortgage and using those additional funds to put towards your travel plans, taking trips to see loved ones, and fulfilling lifelong dreams, your housing will still be one of the largest expenses you will have to worry about during retirement. The upkeep on your home and increasing taxes can still take up a large chunk of your monthly budget. As any homeowner would know, there’s ALWAYS another project that requires your attention (and money) popping up around the house. There are certainly those who manage to keep housing costs down, but for many people it’s still a big-ticket item in their monthly budget.
Healthcare Costs Can Be Massive and Take You By Surprise
One of the largest expenses retirees will face in their later years is healthcare costs. This can account for up to an average of over a quarter of a million dollars. Those with major health problems will incur even more. Ways to help reduce this cost include health savings accounts and trying to stay as healthy and active as possible. Retirees should plan to have money earmarked for healthcare costs each year. Working with a financial planner can help you create a plan for healthcare both before AND during retirement. This isn’t something you want to leave to chance.
You Will Likely Continue to Work In Some Capacity
The traditional “retirement” has changed over the years. Where it used to mean someone stops working completely, it can have many different meanings today. Many people will continue to work into their retirement, but the type of work will often change. Some will use their retirement to launch a new type of career, some will work to pay for unexpected expenses, and some will work as a way to simply keep busy and meet new people. This is also the time when many people will volunteer for causes that they wish to support.
Your retirement should look the way YOU want it to. If you want to take on part-time work, go for it. If you want to never work another day in your life, go for it! These decisions are all up to you, BUT whatever decision you make – PLAN FOR IT.
Retirement Can Last Longer Than Expected
The average retirement age used to be calculated based on life expectancy with most people assuming that they will be retired for around 15 years. With improved healthcare and advancement in medical technology, many people are actually living longer than the national average. As we’ve said in videos, podcasts, and other blog posts – retirement today can last some people upwards of 30+ years. That’s a LONG time! The financial plan needs to reflect that possibility and strategies change drastically when you’re planning for 30 years instead of 10-15 years. Be sure that your retirement projections are adequate for a number of different possibilities. Again, this is where working with a trusted financial planner really is valuable.
You can try and minimize the unexpected surprises. Expect the unexpected and plan for the items listed above to give you the best start at creating the retired life you always dreamed of. If you’re worried about the unknown of retirement, or if you’re prepared for retirement, get in touch with us. We would be happy to help build you a financial plan and retirement plan that will help minimize any anxiety surrounding the next chapter of your life. Click here to schedule an initial call with our team. There is no cost or obligation involved!