#88 - The 6 Biggest Expenses During Retirement

Hey folks, Roger here… Do you know what the 6 biggest expenses are that you’ll face during retirement? In this episode of the Retirement Answer Man, I want to walk through those expenses for a couple of reasons: 1) You need to have a clear picture of where you’re headed so you can be prepared when you get there. 2) Because in keeping with the theme of my show this month, WHEN you can retire could depend on whether you actually make those preparations or not and on the decisions you make about the expenses you’re going to have to support during retirement. I’ve put together a great show for you, so I hope you’ll hit the play button, listen in, and give me your feedback to this episode.

In our “Hot Topic” segment: Is a Quantitative Easing 4 coming?

In case you’re not familiar with the term “Quantitative Easing,” let me put it in a nutshell for you. Simply put, QE is when the government, for various reasons, decides to put more money into the economy. How do they do that? Basically, by printing more money and making it available. Their hope is that the new money they pour into the economy goes into the investing and business development sectors, thereby boosting the economy. There’s been a lot of talk lately about whether or not another QE is coming, and in today’s hot topic segment I’m going to tell you what I think about the possibilities and give you a small bit of practical mindset advice about how you should think about it.

You don’t have to be at the mercy of your retirement expenses.

While it’s true that you won’t likely have the same amount of income during retirement as you have pre-retirement, you don’t have to feel like your lifestyle and ability to live is being ripped out from under you. I’d suggest that one of the main ways you can take control of those things is by examining and planning the expenses you’re going to face during retirement. You’ll have some big ones to contend with: housing, health care, automobile expenses, and two others, but the choices you make about those could determine what your lifestyle is like during retirement AND whether you might be able to retire a bit earlier. In this episode, I spend a good deal of time walking through each of those expenses so you can not only go in with your eyes open but also make good decisions ahead of time to enable you to make the most of your retirement dollars. Give it a listen.

Do you know what the #1 biggest retirement expense is?

You probably guessed it, it’s your housing. It makes sense that the biggest expense you have before retirement is going to be the same after retirement. But when you think about the cost of your housing during retirement, it’s always helpful to keep in mind all the things related to housing that could impact the costs you pay. For example, I often see clients make the choice to downsize their home or even to move to another state where property taxes aren’t as high. Those are not necessarily easy decisions to make but can dramatically impact the amount of money you’re paying out each month so that you can keep a bit more in your pocket or to support the lifestyle you want to have in your later years. I’ve got lots of tips for you about how to plan for and mitigate your retirement expenses in this episode.

When can you realistically retire? I’ve got a free webinar coming up to help you figure it out.

To culminate my October theme of “When can you retire?” I’m going to be hosting 2 identical webinars to help you answer that question. I’m going to walk through a 4-step method you can use to answer the questions, “When can I retire and what will my retirement look like?” I’m excited to bring you this informative and practically helpful webinar to help you discover the most things that will determine the answers to those questions. The webinars are coming up on Oct. 28th and Oct. 29th, 2015, and I’d love to meet you on that platform. To register or find out more about my free upcoming webinar, go to www.RogerWhitney.com/4steps. Choose the date that’s best for you… and even if you can’t attend, go ahead and register because we’ll have a replay that you can watch later at your own convenience.

OUTLINE OF THIS EPISODE OF THE RETIREMENT ANSWER MAN

[0:27] Preview of this episode: QE4, When can I retire?, the 6 biggest costs of retirement
[1:14] 2 live webinars coming up: a 4 step method to determining your retirement timing

THE HOT TOPIC SEGMENT

[3:15] Is “Quantitative Easing 4” coming?
[3:45] A good working definition of quantitative easing.
[5:06] How the economic data impacts rates and QE.
[6:04] What happens if quantitative easing is implemented?
[8:06] The bottom line whether QE happens or not.
[9:14] What to do if QE4 happens.

PRACTICAL PLANNING TIP SEGMENT

[10:11] Taking control: acknowledging and managing the 6 biggest costs of retiring.
[10:47] The mindset that impacts the decisions you make about when to retire.
[15:46] The number one biggest cost in retirement: housing.
[22:01] The second biggest cost in retirement: healthcare.
[26:28] The third biggest expense in retirement: taxes.
[31:35] The fourth biggest cost in retirement: the car you drive.
[35:52] The fifth biggest expense in retirement: travel.
[37:54] The sixth biggest cost in retirement: caring for our children.