Your Expenses During Retirement Could Be Lower Than You Think
Beware of financial planners who start by asking you how much money you want to have when you retire; this is a gateway to unrealistic goals and to scams that promise to help you achieve them. Meanwhile, if you meet with an estate planning lawyer expecting to discuss writing a will and saving your heirs money on taxes, your lawyer will probably tell you that writing a will is just the beginning and that, in order for there to be anything left for your family to inherit, you must first plan to support yourself financially in your old age. The idea of saving enough money to be able to survive for decades without any employment income may sound scary, but your expenses as a retiree may be lower than you expect. To find out whether your current income and savings are putting you on track to afford to retire in your mid-60s, or whether you need to make substantial changes in order to afford this, contact a Tampa estate planning attorney.
Smaller House, Fewer Cars, Less Insurance Coverage
Retirement is an opportunity to downsize your lifestyle, and you should treat it as such; your wallet will thank you for it. If you constantly felt like you had to impress your coworkers and the parents of your children’s classmates with displays of material wealth, retirement offers you an opportunity to get out of that rat race. If your empty nest suits you and you plan to use the extra space to host visitors or rent out the extra rooms to tenants, then by all means, stay, especially if the mortgage is paid off. Strictly from a financial perspective, though, it makes sense for most retirees to move to a smaller house.
Likewise, most retired couples only need one car, since you and your spouse are no longer commuting to separate workplaces. Having fewer cars means lower car insurance premiums. While you are saving money on insurance, you don’t need to buy a new life insurance policy if your original one expired and your children are grown up. Don’t skimp too much on insurance, though. Retirees need long-term care insurance, and in Florida, you need homeowners’ insurance and flood insurance, too, since hurricanes and tropical storms make landfall in Florida almost every year.
Don’t Base Your Retirement Budget on Wishful Thinking
When you plan for retirement, focus on how much you can reduce your expenses, not how much you wish you could reduce your expenses. If you contribute money to your children’s financial support, don’t expect to stop unless you clearly communicate to your children that you can no longer afford to give them the financial assistance you have been giving them.
Contact David Toback With Questions About Downsizing Your Lifestyle for Retirement
A Central Florida estate planning lawyer can help you reduce your expenses now so that you can enjoy a comfortable retirement for years to come. Contact David Toback in Tampa, Florida to set up a consultation.