How to reduce your housing and other expenses during the golden yearsMay 11, 2023
If retirement is on your mind, then it is time to start thinking seriously about sustaining yourself in your golden years. Planning for your retirement is not easy as there many factors that need to be taken into consideration while creating the best retirement plan. Many retirees tend to get hit with high housing and medical costs during their golden years, which play spoilsport with their retirement corpus. The vision you have set for your golden years will determine the creation of your retirement plans.
Here are a few tips to give your golden years a boost.
Find a financial advisor
Most of us tend to avoid going to financial advisors because we think that we have the knowledge to manage our portfolios. However, certain financial jargons can throw us off and create a confusion while building a retirement plan. Therefore, enlisting the help of financial planner can help you assess your housing costs as well as other expenses that hamper your golden years.
The largest portion your expenses is housing related. Paying off your mortgage before you retire reduces one of your largest expenses. Most of us live closer to work and don’t mind the housing costs to be close to work. However, once you retire the proximity doesn’t come into play and you can choose to move away to different area to reduce costs. Also, you can downsize and move to a smaller place, if you don’t have your children living with you.
Estimating your basic medical needs is a vital component while making your retirement plans. Medical costs increase as you age and having a good health plan insurance is necessary. Further, you need to keep a track on your premiums and realign or reallocate them to a different plan to make the most of your medi-claim policy. Having a comprehensive term insurance plans coupled with other insurance plans can reduce your expenses as well as increase your savings.
Calculate your needs
Take into consideration and determine which taxes and insurances are necessity and let go of the others. Revaluate your homeowners or renters insurance, life insurance and auto insurance and decide whether the amount you are paying is satisfactory or you need re-calculate them. In addition, to insurance there other taxes that need to be paid, which need to be taken into account. These expenses can change over time and it is important create a contingency fund to tide over.
As age catches up, health care expenditure rises and covering housing costs become difficult, which creates a dip in the saving and on certain occasions drain the retirement funds. Hence, it is important to build a portfolio that can maintain both medical and housing costs along with your other expenses.