When it comes to planning for retirement, there are many things that you should take into consideration. Retirement planning is about more than putting aside a set amount of money for your later years.
Most often, people make the oversight of assuming that once they retire, they’ll end up spending less. While some people can succeed in doing so, it is only because they put in the time and effort to plan ahead. Here are some of the most significant retirement expenses and how to save money on them.
Unsurprisingly, one of the biggest expenses that retirees will have to deal with is housing. Not only is there the cost of the property (mortgage or rent) to consider, but potential taxes, maintenance, repairs, and other odds and ends.
According to a Harvard’s Joint Center for Housing Studies report, around 46% of homeowners between sixty-five and seventy-nine are still paying their mortgage. While one out of four homeowners over the eighty is still paying it off. This means that one should not assume that their home will be paid off by retirement age.
The best way to mitigate this expense is to plan ahead for it. One can either create a financial plan to ensure that the home is paid off before retirement or consider alternatives such as downsizing.
Utilities are a very similar concern to homeownership in that they won’t go away upon retirement. Utilities include everything from gas and electricity to water, phones, cable, and internet access.
Some services offer discounters to senior citizens, and thus this should be one of the first steps to take when trying to reduce costs. Alternatively, smarter technology, such as a programable thermostat, can help reduce heating and cooling costs, while LEDs can help cut electrical costs.
Another significant financial concern for those of retirement age is their healthcare. This includes health insurance, medical supplies (such as medicines and necessary health equipment), and medical services. Additionally, many people must consider health concerns such as long-term care. The unfortunate truth is failing to consider these aspects will not negate their possible necessity.
There are several ways to help mitigate these financial concerns, including understanding all the ins and outs of Medicare. Having a better understanding of Medicare can help one find additional benefits should they become necessary. Likewise, one should consider preventative measures to help reduce costs – with the added benefit of increasing health. This means handling health concerns as they arise instead of letting them sit and get worse.
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