When you sit down to create your retirement budget, it may be difficult to know where to begin. It is easy to remember elements such as housing, healthcare, and groceries, however, there are other important elements to consider. Take a look at this list of essential factors to consider in your retirement budget:
Spousal Retirement Funds
If you have a spouse, you need to consider whether or not they have funds to contribute to your retirement goals. If your spouse has funds to contribute, you need to decide a plan together and figure out how much you have and how it will be used. For example, do their funds cover basic expenses like home insurance and taxes? If not, perhaps their funds more suited for recreational spending?
As much as you need to consider what you will do with your spouse’s retirement funds, you also need to consider what will happen if those funds are no longer available. If your plan is to have the funds to cover basic expenses, do you have a back-up plan if and when their retirement money is no longer available?
Taxes
Unfortunately, taxes don’t end when you retire. Therefore, when you create your annual retirement budget you will need to consider how much you should set aside for taxes and when the money for taxes is available. If you aren’t sure how to calculate your taxes, talk to a financial advisor or a CPA and ask for help.
Emergency Situations
Everyone needs an emergency fund, especially retirees. Do you have money set aside from your day-to-day budget to cover car repairs, home upkeep, or unexpected surgeries? If possible, separate money for unexpected expenses from money for pleasure, such as vacations or hobbies. If you do, you won’t have to sacrifice a bucket-list item for an expense that doesn’t provide any fun.
Remember, how you create your retirement budget is entirely up to you. If you are worried that the money you have saved for retirement is not enough, there are always financial resources such as the Reverse Mortgages that can help you achieve your goals.