As you prepare for retirement, there are a number of things you can consider when making a budget.

A U.S. News and World Report article, 10 Costs to Include in Your Retirement Budget offers up some useful ideas.

Item number one is your housing, which is the largest expense for many retirees. While you may be able to pay your mortgage off before you retire, thus relieving you of a large monthly bill, you may also want to factor in expenses like property taxes, insurance, and maintenance costs.

For some, downsizing may be a smart move. Selling your larger home and going smaller may put a nice amount of money into your account while also leaving you with less upkeep and fewer chores.

Eat at home, save money

Food costs in retirement is another place a little strategizing may save you money. Give up expensive pre-packaged convenience food and cook more often at home. It's cheaper and healthier. Writing out a weekly meal plan may help you stay on budget and on track.

Furthermore, being disciplined about eating at home as often as possible may also mean that when you do enjoy a dinner out with family or friends, you won’t stress as much about the bill because you know the meal is a treat, not a habit.

Entertainment doesn’t have to be expensive

Many museums, theaters, and movie theaters offer senior discounts, and some colleges even offer low-cost classes for retirees. And don’t forget about low-cost or even free community events like summer concerts in the park, library seminars and presentations, and community education classes.

Don’t underestimate how much entertainment you’ll need. The 40 or 50 hours a week you spent on the job needs to be filled with something else. The good news is you have plenty of options, but you may want to work within a budget that gives you flexibility while also providing parameters.

Travel on a budget

Much like with trying new entertainment options, retirees have ample time to visit those places they’ve long wanted to see. But once again, the style and frequency of travel might be dictated by finances. Older folks and AARP members can take advantage of significant discounts that could really add up during the course of a week-long vacation. You can also get creative by researching house swapping opportunities.

Hotel rates tend to be noticeably higher on the weekends. But as a retiree, you don’t have to wait until the weekend!

It’s much the same with off-peak seasons. Want to spend a week in lake country? Book a trip in late spring or early fall, when the weather is pleasant, but crowds are smaller because families aren’t traveling because of school. Even popular destinations like Disney World have times of the year when crowds are thinner and on-site hotel rooms are cheaper.

Set aside money for grandkids

Speaking of Disney World, grandkids are another part of retirement that you may want to budget for. As you welcome new grandkids into the family, chances are you may find yourself spending a bit more money, even if you aren’t an overly indulgent grandparent.

Weekend getaways, trips to the local pizza joint, the latest Pixar movie … over time, these things can really add up. But being honest about how much you think you’ll spend on your grandkids can help you build a budget that reflects your wishes and protects your assets.

Have an emergency fund

Retirees also need an emergency fund. When you’re younger and early in your career and purchasing your first home, you’re told often that an emergency fund is essential because that’s the money you can use for things like urgent home repairs or unexpected travel instead of putting it on a high-interest credit card.

But here’s the thing, unexpected expenses don’t stop popping up just because you’re retired. It’s still good advice to build an emergency fund of six to 12 months of living expenses, that way unexpectedly replacing the fridge will seem more like an annoyance rather than a disaster.

SOURCE
https://money.usnews.com/money/retirement/articles/costs-to-include-in-your-retirement-budget

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