Retirement planning

Retirement Dreaming: 3 Key Considerations

When preparing for retirement, retirees should be attentive to the following three key considerations: faith, family, and friends. On the surface, these sound like fun factors. However, they also represent financial factors of significance.  

Prioritize key factors 

Prioritization will be a personal decision depending on the retiree’s situation. 

  • Is their faith deeply rooted and their church community involvement a rich experience? 
  • Does the retiree have very little family or are they from a big close-knit clan?   
  • Do they prefer a quiet solitary lifestyle or are they longing for increased social activity?

Impact of retiree age and health 

Family, faith, and friends will remain important factors regardless of age and health. They may shift in priority over time. Typically, leaning on faith and family will be accelerated with the rise of health issues. When learning of the passing of more and more friends, many seniors begin to retreat from friendships later in life. 

Relocation tips 

The geographic relationship of family is significant for a variety of reasons. If located too close, grandparents may be called upon for a full-time babysitting gig. Instead of getting to love on their grandchildren on their terms, it may become a second career they were not expecting. If they have moved across the country to get away from big-city prices, politics, taxes, etc., they may begin to feel isolated from family and friends and this can become a costly issue if they need to travel regularly to stay engaged.   

Though a person may be downsizing the square footage of their residence in retirement, this doesn’t always equal less cost. Many seniors are tired of their large family home and want to move to a senior community with a home that has less square footage to clean and maintain. At first thought, this seems like a great idea. Again, proceed with caution! When purchasing a new home in a planned community, even if the retiree does not choose any upgrades like those shown in the model homes, an additional cost may be incurred. For example, HOA fees, landscape (most new home construction requires a small amount of hardscape or landscape to be added within the courtyard or back patio), and moving expenses may be incurred. If a used home in a senior community is selected there may be cosmetic updates required like new paint, carpet, appliances, etc. and now the benefit of new construction warranties is not available.

Savvy retirement messages retirees can’t afford to miss  

Every day is a Saturday. No rise and shine commitments and plenty of idle time to delve into hobbies. This seems ideal at first. However, take caution! I like to ask when working, did the retiree spend more money on weekdays or weekends? Most will answer, on the weekends. They may go on to say, I was too busy during the week to shop for items wanted or eat out at breakfast and dinner. Well, guess what, in retirement, every day is like a Saturday. It can be easy to spend way too much on the weekend. Retirees often increase their current hobby activities and even take up additional hobbies. With this increase in activities comes the added expenses like new outfits, fees/dues, transportation costs, and meals eaten out with friends.  

Be aware of downsizing pitfalls

Though a person may be downsizing the square footage of their residence in retirement, this doesn’t always equal less cost. Many seniors are tired of their large family home and want to move to a senior community with a home that has less square footage to clean and maintain. At first thought, this seems like a great idea. Again, proceed with caution!

When purchasing a new home in a planned community, remember upgrades like those found in the model homes come at an additional cost. Don’t forget the HOA fees, landscape (most new home construction requires a small amount of hardscape or landscape to be added within the courtyard or back patio), and moving expenses may be incurred. A used home in a senior community may require cosmetic updates like new paint, carpet, appliances, etc. 

If you plan to retire soon, it is time to make a plan

As you approach retirement it is time to get a plan in place. During the financial planning process, your advisor will help you set and prioritize goals and prepare you for unexpected changes you may experience in life. What if inflation continues to outpace my income? What if I experience a divorce or the death of a key family member? Having a financial plan in place prepares investors so they can move forward in life with confidence and so they are not blindsided by the unknown.

You don’t have to navigate your finances alone

Contact Imagine Financial Services. Learn about the services provided and associated costs. 

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