When you think about retirement, you may think of drastic changes in the way you live day to day.
But you might be surprised to learn that some things don’t change when you stop working. Bills still need to be paid and you may need to find something to do if you find you have a lot of free time.
So, before you prepare for drastic changes in your life after work, here are some things that could follow you from employment to retirement.
1. You still have to pay for insurance
Insurance costs could be a costly item in your retirement budget, but you’ll be grateful to have insurance if you need it later.
You must have supplemental health insurance or a Medigap policy to help cover your health insurance costs. And consider adding long-term care insurance for items like retirement homes or home care as you age.
2. You still have to pay housing costs
Unfortunately, your mortgage doesn’t go away when you retire. Factor in your monthly mortgage costs when calculating how much you’ll need each month in retirement.
You should also remember monthly expenses such as utilities, insurance, homeowners association fees, or lawn maintenance and snow removal. And it’s also a good idea to factor in one-time costs like a new roof or emergency appliance repairs.
3. You should always monitor your 401(k)
You’ve been diligently putting money into your 401(k) or an IRA during your working years and watching it grow to prepare for the day you stop working. But you can’t just set it and forget it.
Instead, regularly spend time tracking your investments. You may want to monitor your portfolio more closely during periods of volatility when the market is swinging up or down. You may also want to consider the risk profile of your investments as you age, moving money from stocks to bonds. If there are big stock market declines, you won’t have decades to make up for market losses.
4. You could still work
You may have underestimated your monthly expenses in retirement, which could lead you to return to work. It’s a good idea to figure this out when planning your retirement budget so you can work longer if needed.
You may also want to return to work. A job can give your day extra structure if you find yourself bored or constantly looking for something to do in your life after work. And a job after you retire is a great means of supplementing social security.
If you choose to work, make sure you understand Social Security rules about how much you can earn if you haven’t reached full retirement age.
5. You still have to pay taxes
Taxes are inevitable, so be sure to take them into account when creating an estimated budget for your retirement years. In addition to property taxes on a home you live in, also consider taxes you may have to pay when you withdraw money from your 401(k) and other investments. You’ll also want to find out about your state’s laws regarding taxes on things like Social Security or a pension if you have one.
6. You still have to adjust to the cost of living
Where you live can have a big effect on how much money you spend in retirement. If you want to move to a city or continue to live in a city with a high cost of living, this should be factored into your retirement. Remember, the cost of living covers day-to-day expenses like groceries as well as big-ticket items like retirement homes or end-of-life care.
7. You still want to spend time with your family.
Retirement can be a great way to spend more time with your children and grandchildren or to visit your siblings and other family members. Or you might just want to go out to dinner more often or attend events with your spouse. The costs associated with spending time with your family are the same before and after retirement, so consider family entertainment as part of your expenses.
8. You still have major expenses
Do you take a long vacation every year? Or do you plan to buy a new car in the next few years? These expensive items can significantly reduce your budget. Instead, you might want to consider going on vacation on a budget or settling for something more affordable than your dream retirement car.
9. You always need an emergency fund
Emergencies don’t end just because you stopped working. If you funded an emergency account while you were still employed, don’t use it for day-to-day retirement expenses. You don’t know when you might have an emergency home repair, accident, or unexpected medical bill that needs to be covered. If you have an emergency fund, you won’t have to dip into your retirement savings to cover these types of bills.
10. You still need to save money
Just because you’re done making money doesn’t mean you have to stop saving money. There are still ways to bring in extra cash without a hustle or sell some of your assets as you downsize. You can also consider other investments like real estate that can help you earn additional passive income after you retire.
Remember that you can still find ways to save money even if you’re no longer bringing in a steady paycheck, and every little bit can help.
At the end of the line
One of the best things to do, whether you’re working or retired, is to create a budget to help you eliminate financial stress and organize your expenses and income. And don’t forget to keep an eye on the management of your investments to accompany you throughout your retirement.
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This article 10 Surprising Ways Your Life Stays The Same After Retirement originally appeared on FinanceBuzz.