One thing that many retirees don't plan on is the reality of unanticipated bills during their golden years. The Fire Department may require you to pay for expensive tree trimming, even if the pines and oaks aren't on your property. In Wrightwood, CA, we are required to maintain the vegetation ten feet from our property line to the road. This can get very expensive.
You may need to paint you home more often than you expected. Blistering, hot summers can be very hard on the exterior of a house, and cause your paint to peel. Property taxes may go up, even with Proposition 13.
Inflation is another sneaky way you may find yourself paying far more for groceries, repairs, and home maintenance. It is so important to factor in for these items. The price changes over time can be shocking.
Even the IRS could surprise you with an unexpected bill. If you are paying quarterly on your retirement income, and your accountant makes an error, you are still liable. Sometimes these mistakes can result in a letter requiring a large payment.
The ever important emergency fund saves the day when these issues arise.
Have you had any unexpected expenses arise recently?
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Another excellent post about retirement, Stephenie. Yes, being prepared is the key and an emergency fund is a must! I had an unexpectedly high natural gas bill during last winter, not due to increased usage but, because the gas company increased their fees! That was a bit of a shock and messed up my careful budgeting, but, I had an emergency fund and I was able to pay the bill. Didn't like having to do so, though! Also, if you have aging pets, then, factor in higher vet bills!
ReplyDeleteThank you, Bless. I frequently read about retirement, and I enjoy writing about it. I remember those gas bills. I was fortunate, because I had switched to wood and electric heating. I only used gas for my sauna, once a week. So glad you were able to pay that huge bill with your emergency fund. Yes, aging pets are more expensive.
DeleteI'm only "semi-retired" as I just recently (in May) finished working my hospice contract that I've had for the last 18.5 years. So now I just have one small contract at my own centre and starting to settle in to a low key life in the moment. We've saved for years to get to this point, and I'm happy with where we're at, but it is concerning that we could end up with an unexpected expense. I think we'll start another savings that will be for those expenses, then it won't feel so bad if they come along AND we won't have to pull from our retirement savings. Hope that made sense! Thanks for your posts. I always find them helpful as we work towards full retirement. X Chy
ReplyDeleteYes, I understand what you mean, Chy. I keep some savings separate to avoid having to sell any stocks. It's so important to stay on a budget. Retirement takes a lot of discipline.
DeleteBeing on a pension, and earning just a little bit of cash each week, means that I'm really careful with money. My last car was bought with a gift of $1,000, I sold my car for $2.500, got a $1,000 discount as there was a car sale. My new car cost $4,500, which of course I didn't have to come up with as it was al covered. Plus an extra $500 for getting it checked out and all of the official stuff needed, and this was all that I had to pay overall. I always have enough money saved in case I have to move home, put down a deposit on another apartment, Money for car repairs, new tyres, a holiday trip somewhere local or even in the South Pacific. My last computer I bought at a sale and paid cash. My clothes are bought at sales or 2nd hand, and I'm really fussy about what I have. I think that my generation just knew how to save and be careful with money, so that retirement isn't such a shock.
ReplyDeleteratnamurti, The Gas Co. in California charged people five times the normal rate last year. That's why so many people were shocked. They had $1,000. gas bills for just one month. I think when you own a home, it's much different. It sounds like your retirement is going well.
ReplyDeletethat is quite criminal, 5x cost raise. A lot of homes here are on gas. And you are 100% correct. It is harder owning one's own home.
DeleteWe did have some unexpected car expenses this spring. One car needed new brakes and one car needed a new temperature sensor for the radiator. I was very grateful for what we call our contingency funds. We have been retired now for 6 years (Steve) and 5 years (me) and so far have been able to survive on pension and Social Security. It is not easy to do that sometimes here in California.
ReplyDeleteGood for you, Anita. It always feels good to take care of home and car maintenance. Yes, retirement in California is a world of it's own, but so lovely.
ReplyDeleteNo unexpected expenses yet this year other than a car tyre, phew. Life has gotten more expensive though, that is for sure.
ReplyDeleteI know what you mean, Christina. My dad always warned me about inflation in retirement. He said that a hot dog cost 5 cents when he was a boy.
DeleteThe early death of my darling husband in March, when he was only 63, has impacted all of my life. We were both already retired, with occupational pensions as we neither of us had reached statutory retirement age, but we were more than comfortable, able to future proof our cottage , and give our children deposits for homes of their own . His death has reduced my income by over 50%, but dying before stat retirement age has resulted in his pension company sending me a considerable cheque in lieu of the pension that he didn’t live to see . I would give every penny of it back to have even a little more time with him
ReplyDeleteSiobhan x
Thank you for sharing your story, Siobhan. How sad. My condolences for your loss. I am glad to hear that you are doing well on you own and that you are comfortable in retirement.
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