Planning For Retirement? Don’t Overlook These Five Factors

Forecasting expenses in the distant future, particularly over several decades, poses a notable challenge. As funds are funneled into IRAs or 401(k)s, the prevailing belief often leans toward a hopeful outlook that steadfast financial contributions will pave the way for a comfortable retirement. However, there are certain underestimated variables in the calculation of retirement expenses.

Understanding these five factors could aid in cultivating a more accurate and pragmatic retirement budget.


In addition to seeking warmer climates, many retirees are drawn to specific states due to differences in the treatment of retirement income within those regions. Some of the most tax-friendly States for retirees include well-known retirement hubs, such as Florida, Alaska, Tennessee, Wyoming, and Pennsylvania.

However, relocating to another state may lack appeal for many retirees despite the financial incentives. Many retirees desire to stay put in their current states and homes, whether due to proximity to family members or ingrained connections in social and religious communities. If this sentiment resonates with you and you reside in a state that taxes income and Social Security benefits, it may be prudent to increase your monthly contributions and save more.


When calculating the monthly income needed for retirement, it’s crucial to consider the impact of inflation.

According to, $100 worth of groceries in 2001 cost $143.56 in 2021. Assuming an annual inflation rate of 3%, an individual who wishes to maintain their current lifestyle at $5,000 per month in 2024 should budget for roughly $11,783 in 2052.

Health And Long-term Care

Fidelity suggests that the average retired couple aged 65 in 2024 needs about $315,000 to cover health care costs during retirement.

Although it may be unpleasant to think about, there is also the possibility that you or your partner may need to live in a long-term care facility.

Supporting Others

As advancements in science and medicine persistently extend the average lifespan, an increasing number of adults navigate the challenges of the “sandwich generation.” This term encompasses individuals who, amid the evolving landscape of longevity, are tending to the needs of elderly parents while also providing support for their adult children.

According to the Pew Research Center, more than half of Americans in their 40s are in the sandwich generation, while 36% of people in their 50s, 27% of those in their 30s, 6% of those under 30, and 7% of those 60 and older are in this situation.

The Fun Stuff

Concluding our exploration of retirement expenses is the most captivating category often overlooked in budgeting for new and old hobbies. In retirement, exploring pursuits previously deferred or embracing entirely novel hobbies usually takes center stage.

Travel can also incur significant costs, especially when relocating, which may require more frequent trips to connect with friends and family. Budgeting for extracurricular activities and travel will allow you to take full advantage of the resources that were scarce during your working years: time.