Whether you plan to spend retirement globe-trotting, or choose to stay home and cultivate the ultimate garden, retirement isn’t going to be cheap. In fact, it will probably cost a lot more than you expect. In addition to paying for basic needs, like food and shelter, you’ll undoubtedly be faced with a handful of unforeseen expenses, like the ones we’ve gathered below.
Take a look at our list of the top five unexpected expenses retirees are often faced with, incorporate them in your long term financial plan, and you’ll be well on your way to enjoying the post-career life you’ve been dreaming of.
1. Elderly parents may need a helping hand.
We’re all living longer, and that means you may end up caring for parents who can no longer care for themselves, but can’t afford the staggering cost of a residential facility. A recent report from the Pew Research Center finds that nearly 40 percent of adults in America are taking care of a person with a significant health issue. And while you’re caring for your loved one, you’re likely shortchanging your own financial stability according to the National Alliance for Caregiving. In fact, a study from MetLife shows that a female caregiver, who exits the work force prematurely, will (on average) lose more than $324,000 in wages and Social Security and pension benefits over her lifetime.
2. Your adult children could return to the nest.
If aging parents don’t add to your financial stress, adult children returning home might. The downturn in the economy has left many “children” in financial binds that parents naturally want to solve. But bailing out your kids or welcoming them back into your home could deplete your nest egg prematurely. If you’re lending a hand to your adult child, put a cap on the amount of money you’re going to give them, have a repayment plan in place, and if they move back in, agree on how long they’ll stay.
3. Dental work will likely increase.
Crowns, bridges and root canals are incredibly expensive, and aren’t fully covered by typical health care plans. Implants, which can cost a few thousand dollars, aren’t covered at all. If you don’t have dental insurance, you should put aside an extra stash of cash to keep your teeth in tip-top condition. And make sure you’re brushing, flossing, and using a mouthwash so you can keep this expense as minimal as possible.
4. You’ll have unanticipated home repairs.
From a new roof, to new appliances and revamped HVAC system, as your home ages, you can expect home repair costs to escalate. And you’ll probably find that you’ll have to pay someone to take on many of the home maintenance tasks you used to tackle. While you’re still working, undertake as many home improvement projects as possible and work out a financial plan to pay for major repairs. That way, even if you downsize to a smaller home you’ll be able to ask top dollar when you put your current one on the market.
5. You’ll likely need to implement additional safety and security measures.
From concerns about falls, to the threat of a break-in, as we age we tend to feel less safe and secure in our homes. Moving to an assisted living facility is an option, but they’re notoriously expensive and can drain your retirement fund in a flash. Thankfully, advances in security technology now allow us to stay in our home and enjoy the freedom of independent living. In addition to traditional services like motion alarms, most major security system companies now offer a range of home safety solutions that ensure help is just a push of a button away. Learn more about home security options and start your search for the perfect home security plan.
AARP recently reported that almost half of all Baby Boomers plan on working “until they drop.” If you don’t want to be one of them, factor these unexpected costs into your retirement plans.
Written by Alexia Chianis
Wanderlust junky and mom of two, Alexia is a former police officer and U.S. Army Captain who draws on her experiences to write about a myriad of safety topics. Learn more