Successful retirement planning requires a great deal of foresight. Although it is impossible to say exactly how much money you will need once you have settled down, it is possible to make helpful estimates. In this article, we will take a quick look at a few of the most important ways that retirements could potentially reduce your expenses, along with a few of the most important ways that retirement could potentially increase your expenses.
How retirement could increase your expenses
• Relocation. Many retirees opt to move to a different part of the city, the country, or the world once they are no longer constrained by the physical location of their workplace. Perhaps you have always dreamed of living in a more tropical region such as Florida, for example — or perhaps you simply long to move closer to family or friends. If relocating is part of your plans, then you should definitely plan for moving expenses.
• Living Expenses. If you are relocating, then research living expenses in your new area — the cost of food, rent, necessities, etc. all vary based upon location.
• Entertainment expenses. Seeing shows, dining out, and participating in other entertainment activities cost money. And with increased free time, you will have lots of chances to participate in these pastimes.
• Inflation. The value of paper currency is always falling. Saving up — and investing in inflation-countering assets — is the only smart way to overcome this obstacle.
• Travel. Retirement is a time to spend with friends and family. It is also a time to achieve lifelong dreams such as seeing new places and experiencing new cultures. Doing these things requires money set aside for travel expenses, however. So be sure to calculate this into your retirement plans.
How Retirement Could Decrease Your Expenses.
• Commuting less. Your daily commute requires you to dish out big bucks for gasoline and car maintenance — once you retire, this won’t be the case.
• Your professional wardrobe. Suits, dresses, shoes, ties, accessories…the list goes on and on. Maintaining a professional wardrobe can be quite the expense. Aren’t you glad you wont need to do this once you’re retired?
• Restaurants. Retirement allows you to dine out when you want to dine out. If you are used to spending lots of money on lunches in the city during the workday, then you can prepare to lower that expense one you retire.
• Living expenses. We already mentioned that relocating can affect your living expenses — and this could possibly be a net positive!
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