Retirement planning involves careful considerations of many different factors that may affect your life from both financial and personal perspectives. While these plans often seem to boil down to income and budget for many people, we wanted to inform you of a few things that often take retirees by surprise. After all, if you know about them ahead of time you can also make a plan to deal with them.
The transition doesn’t always go as planned. Not everyone will experience a smooth transition to retirement life at first. Sometimes it feels awkward and oddly dissatisfying. Give yourself time to adjust, and remember that plans can always change if you don’t feel happy with your new lifestyle after a few months or so.
Housing can still be a large expense. Not everyone manages to pay off their mortgage before retirement (a common goal). But even if you do, property taxes, insurance, and the cost of repairs can really add up. Also, chores like yard work and cleaning can become more difficult in later years, so planning to pay for help would be wise.
Health issues can take you by surprise. Even if you’ve enjoyed good health for decades, issues can start to pop up after age 60 or so. Since illness and associated disability can take you by surprise, carefully consider your coverage options when enrolling in Medicare. Additional types of insurance, such as long term care insurance, can help to address surprise expenses. Contributing to a tax advantaged health savings account now, during your working years, can also help you build up a cushion for unexpected medical expenses.
You might also feel younger! The occasional health issue aside, many retirees actually report that they feel younger! This might happen due to the reduction in responsibilities and stress that retirement brings to your life. This is a happy surprise, but you might want to budget for travel or new hobbies to enjoy at this time.
You might feel lonely. Getting away from the office might sound like a dream come true now, but loneliness can settle in later. Stay flexible in your mindset, so that you can consider other living options later.
Many retirees go back to work. Whether because you’re lonely, bored, or want to earn extra money, you might feel tempted to pick up a job at some point during retirement. There’s nothing wrong with that, but let’s discuss the potential impact on your income taxes so that you know what to expect.
No one is saying all of these surprises will happen to you, but solid preparation can help you address anything that does happen. Continue to meet with us regularly, both now and after retirement, so that we can help you anticipate and prepare for those little surprises that life throws your way.