Budget For Retirement Travel

For many people, the dream of traveling in retirement is strong. You may want to plan trips to see your adult kids and grandkids a few times per year, and you likewise may have bucket list trips in mind. Because you do not have a job to rush back home to, retirement is an excellent time of life to travel more. However, some people may not properly budget for their trips. This inevitably means that trips simply do not happen or that financial stress makes them less enjoyable. Learning how to budget properly for your trips is essential if you want to enjoy them fully.

Add Traveling Expenses to Your Budget

The first step to take when planning for trips is to properly fund them. One of the easiest ways to accomplish this is to incorporate traveling expenses into your regular budget. Many retirees create an annual budget, and they break this down into a monthly budget. Even when retirees incorporate a line item for traveling expenses into their budget, they often fail to budget enough money for these experiences. Depending on your plans for various trips, a single trip may easily cost you several thousand dollars or more. If you plan to travel at least a few times per year, your budget will need to be adjusted accordingly.

Prioritize Your Trips

If you are like most retirees, you may have a lengthy list of desirable amazing destinations. However, these you may only be able to visit a few destinations each year. You may want to prioritize the trips that you want to take so that you can cross those off of your list first. Remember to factor in costs for your trips to visit family with your recreational trips. Determine which trips that you want or need to take each year. This is essential if you want to properly allocate funds in your budget for all of your planned trips.

Research Expenses

The expenses for each of your planned trips could vary substantially. For example, you may have plans to drive to a few national parks and to take a trip to Europe a few months later. The Europe trip may be much more expensive. With both types of trips, you may need to essentially create a detailed itinerary. Research accurate costs for each aspect of your trip so that your budget is realistic. Remember to factor funds for food and gas.

Look for Savings

Remember, seniors often qualify for special savings at restaurants, theaters, stores, hotels and more. When you begin planning each of your trips seriously, spend time analyzing all discounts available. Look for alternatives, such as staying at a different hotel that may offer a senior discount. Take advantage of senior discounts, but be aware that other discounts and savings may also be available. For example, you can travel during a non-peak season to likely save a substantial amount of money. You can buy plane tickets on non-peak days or in the very early or very late hours of the day. These are only some of the many ways that you can potentially save hundreds or thousands of dollars on your trips.

Traveling may be one of your primary goals in retirement, but your dreams of taking amazing trips may not happen if you do not have money available. As you can see, you should work on budgeting properly for them in various ways in order to have funds available for your trips. You can get started today by adjusting your budget and researching desirable destinations that you want to visit within the next year. By doing this, you can get the wheels in motion for taking exciting trips to amazing locations.

Getting Organized In Retirement

Once you reach your retired years, you may think that your previous planning efforts would put you in the clear from a financial standpoint. However, the numbers that you use in your projections are in flux. This means that you must stay organized and keep on top of your financial status if you want to enjoy financial peace of mind in the years to come. However, monitoring your efforts on a monthly basis may be overkill. Furthermore, when your oversight of your finances and budget is too frequent, it can be difficult to spot trends and potential issues. With this in mind, it is great to take organizational steps at the beginning of each year. When you fall into this habit, you can stay on track to meet your future financial goals.

Review Last Year’s Spending

Your personal budget in your retired years will fluctuate considerable, and many retirees notice that their expenses tend to increase over the years. For example, our budget may have been well- organized initially, but it was riddled with uncertainties. After all, you did not know with certainty what the inflation rate would be like, which service providers would increase rates and more. When you keep your budget updated based on realistic numbers, you can better plan for the future. A smart idea is to review your average expenses for all categories over the last year and to update your budget accordingly for the next year. Projecting your budget for the next several years is also a smart idea.

Check Your Debt Balances

Part of your planning efforts to prepare for your retired years may included paying off all outstanding debts. However, you can accumulate new debt in retirement. For example, you have had a financial emergency that resulted in credit card debt, or you may have needed to use auto financing to buy a new car. Therefore, get in the habit of always checking your debt balances each year. Your goal should always be to eliminate debt balances as soon as reasonably possible.

Analyze Investments

Just as you need to monitor your progress with debt reduction, you also need to analyze your investment accounts. Your future income is based on how much money you withdrawal from your accounts now as well as how well your investment accounts grow. It is just as important to stay on top of these accounts in your retired years as it was to stay on top of them in your pre-retirement years.

Update Your Net Worth

You do not necessarily need a specific net worth figure to retire. You simply need to have low enough expenses that you can live comfortably on the income that you have available. This is a simplistic description of finances in your retired years. For example, you need to take into account inflation, increasing medical expenses and more. However, when you update your net worth figure while taking these other steps, you can see how your wealth is increasing. Seeing how much progress that you have been between last year and this year can help you to feel more relaxed. Keep in mind that many retirees who properly manage their finances may see their net worth continue to increase over the years.

Financial management does not end after you retire. In fact, preparing for retirement is only the first step. Once you are retired, you must stay on top of all aspects of your finances so that you can ensure continued financial freedom going forward. Remember that it is easier to correct issues sooner rather than later.  A yearly review is common for our clients, if you need help staying on track and maximizing your retirement goals, call us today.

This Could be Your Biggest Expense in Retirement

No matter what your age, it’s important to start preparing for the time when you eventually retire. One of the biggest financial issues you may encounter by the time you’re ready to stop working is how much money you will need for your health care. In general, this can be a sizable amount. On average, a person of 65 would need around $190,000 to pay for costs related to their health. This estimate doesn’t even take into account any preexisting chronic conditions or disabilities.

Unfortunately, the one mistake people could make regarding retiring is that once they reach the age of 65, they will be eligible for Medicare and that it will cover all their needs. However, in reality, Medicare isn’t free and people are responsible for covering their premiums, deductibles and copays. Retirees who require coverage for dental care, prescription drugs, vision or hearing are also required to either buy additional insurance or pay for these things out of pocket.

However, there is good news. There is a lot you can do to manage the costs of your medical care. Planning ahead can really be a lifesaver for your costs once you retire. These are ways you can ensure that you are covered:

Health Care Investment Account: Creating an investment account for your estimated medical costs can be a great idea. You should ensure that it’s kept separate from your other retirement money. Estimating how much you will need for the future can help you to be successful at saving for these costs. Additionally, these types of accounts also allow you to save money on your taxes.

Consider Long-Term Care Insurance: Over half of people 65 or older will require long-term care at some point in their lives. Getting a long-term care insurance policy can ensure that your future health needs are met if you require assisted living, home care or a nursing home. This option is also expensive, but it is well worth it if you save early on and already have chronic health conditions or a family history of certain conditions.

Take Care of Your Health: Obviously, if your health is better after retirement age, it will be easier on you from a financial standpoint. Your health care expenses will be less than that of someone who isn’t in good health. Eat a well-balanced diet, incorporate physical activity into your everyday routine, maintain a healthy weight and get a good night’s sleep daily. This offers you a dual benefit in enjoying better health than your peers and helping you save money in the long run.

Use COBRA: If you had health insurance through your last job, you can take advantage of COBRA to continue using it after you retire. COBRA allows you to use your work health insurance for up to 18 months after you leave the job as long as the company employs at least 20 employees.

These are great ways to go about planning for the time you eventually retire. They can help you to save plenty of money on any medical related costs and can bring you a sense of ease.

10 Reasons You May LOVE Being Retired

If you are like many people, you are probably looking forward to the time when you can retire. It marks the end of an era and serves as a reward for all the hard work you have done over the years. Retirement is a time you can truly enjoy yourself and reap the rewards of all those years of being in the workforce, no matter what your chosen profession.

Since Valentine’s Day is the day of LOVE we thought we should take a look at the many reasons you may LOVE being retired!   After all, when you’re retired, you don’t have to plan your Valentine’s Day plans around your work day.

It is likely there are personal reasons you’ll love being retired. These are the 10 most notable.

1. Less Stress

Being retired means you no longer have all the same obligations as when you were working. Your kids have probably all flown the nest and are living on their own. You may have also already fully paid off your mortgage. As a result, there are far fewer demands on you, which means you experience less stress as a retired person.

2. Go to Bed and Wake Up When You Like

With retirement comes the ability to go to bed and wake up whenever you want. No longer do you have to set an alarm to wake you up early in the morning. You can turn in late and sleep in to enjoy whatever you like the next day. Sip your coffee in your pajamas while watching your favorite morning news program, talk show or game show. Since there are no obligations in terms of when you go to bed and when to rise, you may also find your sleep improving and that you’re feeling more rested each day.

3. Avoid Annoying Commutes

One of the best things about being retired is that you no longer have to deal with having to commute to work on a daily basis. Whether you rode public transport or drove to work, you no longer have to endure the crowds and excessive traffic during rush hour. It also leaves open more time for important appointments in the middle of the day, such as for medical or dental purposes.

4. You Can Wear What You Want

You no longer have to worry about planning what to wear to work. Instead, you can wear whatever you like and can dress casually in your favorite pair of worn jeans and T-shirts or even baggy sweats. After retirement, you no longer have to worry about wearing corporate pressed suits, uniforms or even business casual attire.

5. Spend More Quality Time with Your Spouse

If you and your spouse are both retired, you can spend more quality time together. Even if you’re the only one retired, you can still spend more time with your loved one. It can make planning date nights easier or you can simply spend time together in the comfort of home.

6. Be More Spontaneous

Being retired means it’s the perfect time to be more spontaneous. If you want to get out of the house and go for a refreshing walk in the park in the middle of the day, you can. You can even go away on a trip to another city, state or even country. Now that you have so much free time, you can be as spontaneous as you like.

7. Do Things You Love

While you were working, you no doubt had limited time for certain things. Once you’re retired, you can pursue creative outlets and do other things you enjoy. You may even want to take a course at your local community college that allows you to engage in a specific activity.

8. Exercise More

After retiring, you have more time to exercise. You can go running, walking, biking or swimming whenever you like or even hit the gym a few times per week.

9. Enjoy Cultural Pursuits

You have more time to go to the library to read, visit museums and go to art galleries. These cultural pursuits may have been difficult to enjoy while you were working.

10. More Relaxed

Finally, after you retire, you can relax more in general. You can experience the type of freedom that wasn’t there when you were working.

You don’t need cupid to tell you that planning for a successful, stress free, retirement is important.  We are here to guide you and help you fall in love with your “golden years”.