Well I guess the first thing we need to clear up is what age are we talking about. Depending on when and where you retire some of the things list you still would and should consider.
However if you are a lot older then this is more or less what you are looking at.
Most people are retiring closer to the age of 70 or so and a lot of the things they are paying for are just not going to be much of a concern.
When you look at how much money you will need for retirement it could be a lot less than you think considering a lot of expenses could be gone.
No Need for Rent Checks Mortgage Is Done!
If you are retiring at the age of 65 then lets hope that your mortgage payments are done. If you buy a home at the age of 35 and don’t move or refinance for more years at a lower payment you will have you home paid off hopefully before or right after you retire.
The good news is that most people are paying close to $2k per month in mortgage. When you add that up we are talking an extra $24,000.00 per year that you don’t have to come up with. That is a lot of money saved and if you don’t have the mortgage think about what you could do with the extra.
However lets not forget that just because the mortgage is paid off it doesn’t mean that you are going to be free and clear. You are still going to be responsible for paying taxes and insurance.
Your Retired So No Retirement Savings
Maybe people would say it depends on the age and I would agree. But if you are retiring it doesn’t make sense to save for retirement. At this point you should have already decided how much you needed to retire and have met that figure.
Sure its not like your mortgage or something that is an expense but when you look at it you should have been saving about 10-25 percent of your income. Depending on how much you made that is a lot of money.
Just think if you maxed out your 401k and saved $15k per year on top of other accounts. You could easily have been putting about $20-30k per year. Nothing to laugh about and surely something I am sure you could use to fund your travels and enjoyment while you retire.
The Need for Multiple Cars
In some families have 2-3 cars is a must while everyone is working. Hopefully by the time you retire the cars are paid off. If that is the case you still could have maintenance that is needed and of course gas.
If you choose to you can downsize to one car and won’t have to worry about maintenance or monthly payments on two. Some people will choose to have two cars as it just helps them if they have different things they need to get done.
Commuting to and from work will help cut down on gas but a lot of people forget that they tend to do more driving to sight-see, shopping and visit friends so you don’t really save on gas as much.
Food, Lights, Bills Etc
Buy the time you retire most if not all of the kids are out of the house. With that being said the grocery budget, electric and many other bills should be cut in half if not almost completely gone. Things like clothing, supplies for high school and college are no longer needed.
Think about how much you could save if you no longer have 3 teenage boys living at home. No extra car for them, gas expenses and even car insurance.
What are some expenses you can think of that won’t be needed when you retire?