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Any retirees out there? What is your greatest expense?

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  • Any retirees out there? What is your greatest expense?

    I assume there might be a couple of retired MD's/Dentists on this blog. I am curious what is your greatest expense in retirement?

    Travel? Health Care? I am 8 - 10 years away from retirement, and am simply interested to here how others are doing. My own models would indicate that travel would be my greatest expense, but I imagine that will be in the early years and that later on health care may predominate.



  • #2
    Bumping as I would be interested in hearing responses from some actual retirees.

    I think you identified 2 of the most likely culprits.  Retiring before 65 makes health care a major concern.  Like it or not, the ACA might help you out in an early retirement scenario.  Travel will be a big expense for many of us by design.  College costs / ongoing support of grown children could be a top expense for some.



    • #3
      I don't really count travel expenses as they are discretionary in my book.  Support for children is still my largest expense.  3 in university and 1 in high school and things add up.  University costs are covered by their college savings account so no worry there.  Biggest single expense has to do with transportation.  6 drivers who have 3 vehicles and a motorcycle so insurance and maintenance are the big costs.  Thankfully in Canada health care is covered by that largest of all expenses - taxes.


      • #4
        Healthcare prior to 65 can be 2-3k/month for husband and wife

        after 65 your cost of living generally decreases


        • #5
          Health care costs areon average, are predicted by many sources to be the largest expense for retirees. This includes the cost of LTCI and other insurance policies. The problem will only worsen as LTC costs increase, people live longer, and LTCI policies reduce payouts to cope.

          However, our clients who stay in their homes are spending a lot on the cost of maintenance, especially for those with a second home. Here is a more recent article.
          Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087


          • #6
            Early retiree here ..... single parent.  Fortunately we are both healthy .... so only medical expenses are only ~$8200 in annual premiums (recent big jump).  By far the biggest expense category is travel/discretionary spending.  The runner up is real estate taxes on multiple investments.


            • #7
              Thanks for the resources, Johanna! It gives an idea of current required amounts for healthcare costs but how do we calculate what it will be a couple of decades down the line, with inflation, etc? Other factors, like drastic changes in the healthcare scenario cannot be accounted for, of course.


              • #8
                In a pre-retirement lecture, I was told that the three biggest expenses that retirees underestimate, in addition to health care costs, are home repairs, buying new cars, and travel.  In other words, those items are considered, but those expenses are underestimated.