After years of careful planning and saving, you’ve just retired, or you’re about to take the plunge. But no matter how carefully we plan, there are always some things in life that surprise us. Check out these four things that retirees commonly say surprised them, regarding their new lifestyle.
Retirement can be boring. During our working years, most of us imagine that it would be nice to stay home all day, without demands on our time. And it’s true that constantly being over-scheduled is stressful and undesirable. But the opposite can be quite boring and unsatisfying! Before you retire, or shortly afterward, identify different ways that you can stay active and socially connected.
Income taxes can be disappointing. Retirees are often advised to establish several streams of income. However, if you earn above certain thresholds, your Social Security benefits could be taxed. Taxes on retirement plan withdrawals might also surprise you.
Retirement could last longer than you think. Currently, the average life expectancy for a 65-year-old man is about 84, and for a 65-year-old woman it is about 86. However, one in four people will live past age 90, and one in ten will live past 95. For those who retire at age 65, a 20-30 year retirement is entirely possible*.
The cost of healthcare can be shocking. Contrary to common belief, Medicare doesn’t swoop in and pay 100 percent of your medical expenses once you turn 65. You will still pay premiums, co-pays, deductibles, and the cost of medications or equipment not covered by Medicare. In fact the average 65-year-old retiree can expect to spend about $260,000 on their healthcare throughout retirement.** And that figure doesn’t even address the cost of long-term nursing care.
On that note, give us a call if you’re concerned about your out-of-pocket spending on medical bills. We can help you evaluate different Medicare supplemental plans and other options to keep your costs affordable.
*Social Security Administration
**Fidelity’s Retiree Health Care Cost Estimate.