Once you reach retirement age you hope to live out the remainder of your days in relative comfort. However, the majority of retirees are unable to sustain their lifestyle once they retire. If you find yourself needed to go into a care facility the cost attached are astronomical.
If you are lucky enough to be mortgage free by the time you retire this is a huge weight off your shoulders. Not everyone is able to do this. You will also need to take into consideration that the upkeep of your home will not stop once it is paid off. There will still be expenses that need to be covered annually. One of these is property taxes. Depending on where you live this can become quite expensive. Not something that you thought you would be dealing with in retirement.
Your health will become more of an expense after you retire. Even if you have always been relatively healthy, you will need a comprehensive Medicare for emergencies. It is also advantageous to have a Medigap to make sure that you do not get saddled with astronomical bills if something does happen to you. This Medigap is a further monthly expense eating away at your retirement fund.
Income vs expenses
You are used to having an income every month that, hopefully, covers your expenses. After retirement that income will decrease but your expenses will change. You will have a lot more free-time in your hands. If you do not plan on spending it sitting in the house you will need money in order to fill all of the time you now have.
Planning for retirement is something that you need to look at long before you are able to retire. It entails careful consideration and budgeting to make sure that you are able to enjoy your golden years without stressing about money. If you want to get senior advice then click here.