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5 things that could cost you more in retirement

Retirement can lower some expenses, but health care, travel, housing and other costs may take a bigger bite out of your budget than you expect

Esther Ann / Unsplash

Retirement can change your finances in ways that are easy to overlook. You may no longer have a daily commute or the same work-related expenses, but having more free time and different needs can also create new costs. That means the budget that worked while you were employed may not tell the whole story once you stop working.

According to a report by Reader’s Digest, retirees can face higher expenses in several areas, from health insurance and medical care to travel and entertainment. Some costs may rise simply because you have more time to spend money, while others are tied to changes that often come with aging. Housing can also become more expensive if you need assisted living or move somewhere with easier access to medical care.

The good news is that not every retirement expense goes up. Transportation costs may fall when you no longer commute, and some retirees can spend less on life insurance if they no longer need as much coverage. Recreation can also become more affordable when retirement communities include activities and amenities in their fees.

Still, understanding which expenses could increase is an important part of preparing for retirement. A retirement budget based only on your current spending habits may leave out costs that become more significant later.

Here are five retirement expenses worth planning for before you leave the workforce.

1. Health insurance could take a bigger bite out of your budget

 Nguyễn Hiệp / Unsplash

Health insurance can become more expensive in retirement, particularly if you are accustomed to having an employer cover part of your premiums. Reader’s Digest notes that Medicare still leaves retirees responsible for deductibles, co-pays and coinsurance. It has a minimum premium, and costs can be higher for people in higher income brackets. Additionally,........

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