SOME FINANCIAL ‘UH-OH’s’ IN RETIREMENTMar 16th, 2013 | By Sharon Shaw Elrod MSW EdD | Category: Senior Finances
Some Unexpected Financial Hits
Many seniors take a backward look at some point in retirement, and find their financial lives are somewhat different from what they expected. We did this recently, and found several expenses we neither anticipated nor expected.
Moving Expenses: We moved after 15 years of retirement. We did not anticipate doing that 15 years ago and the expense of the move was not in the picture until it happened.
Children Needing Help: Like many senior parents today, we find our son needs financial assistance for his living expenses. We did not anticipate this need when we retired, but because of the economy and his personal choices, he cannot make it on his own. We are there for him.
Travel Expenses: We did not expect the numerous trips we have taken over the past 16 years… to say good-bye to dying friends, a favorite uncle, parents; to a nephew’s wedding half-way across the country; travel with grandchildren; to a 50th high school reunion. One-time travel plans are not easy to anticipate. We also did not think about paying for our son’s travel to see us, along with his current girlfriend. Again, we love him and want to be with him, so we foot the bill.
Grocery Expense: We did not know about how our diet would be affected by allergies and personal preferences for organic and natural foods. Buying for these needs means the grocery bill is higher than it would otherwise have been. Of course, inflation is also part of the added expense.
Medical and Health Issues
We knew our health insurance would be available through a pension program. What we did not anticipate is the huge jumps in medical care costs and insurance not keeping up with the increases. And we were just notified by the pension program that it will cease financial assistance for the cost of premiums beginning 2014. Another hit.
Our word to Baby Boomers planning for retirement is this: Be sure you plan carefully for retirement needs and expenses, and then add a minimum of 10 percent to your budget for those unexpected and unanticipated expenses. Inflation will take a significant slice from your fixed retirement income, and the expenses you do not anticipate will take another slice. Plan thoughtfully and carefully. Use the good advice from your trusted financial adviser. And be aware you will still take financial hits you cannot now know about.