Financial surprises in retirement?

Actually there are none … or at least their shouldn’t be.

The fact is that just about every possible financial surprise or better stated, unplanned for financial expense, you have while working will occur during retirement.

You have two choices to deal with them.

Make sure that your stream of income from your investments or other sources is sufficient to allow for financial emergencies. In other words, you live below your means.

And/or maintain and sustain an emergency fund in addition to retirement accounts.

I looked at my own experiences over the last eleven years retired and listed significant unplanned for expenses. I also asked some other retirees. Here is what we came up with. I’m sure there is nothing to shock you, but have you considered them?

  • Major home and car repairs and maintenance like taking down a tree, new roof, four new tires
  • Damage to your property from a storm. Moving to Florida are we?
  • Replacing new appliances. Have you priced a new fridge lately?
  • Dental work. No Medicare coverage for this. We are talking thousands of dollars here.
  • Hobbies. Old or new hobby, have you taken a good look at what it costs?
  • Pets. On average a cat or dog costs about $1,000 per year, but throw in some surgery and it’s big bucks.
  • Helping family. That can be both a big surprise and a big unforeseen expense. You would be amazed at how many retirees mention this one. I bet you thought it was more the other way around.


  1. Never making more than $35,000 during my working years, with an average income of just $12,000 per year. I have become very good at saving money, by not spending it in the first place. You cannot spend what you do not have. I raised 4 children from 1978 to 2009 and none of them became licensed drivers while living at home. Never owned more than one car at a time, no car payments from 1985 to 2020, always saving and paying cash. I walked or used the city bus while saving for a used car from 2010 to 2014. I went 3 years without a home phone once, while having teenagers’ living at home,, because of collect call charges to prove a point. I retired at 50 with a small military pension and started SS at age 62. At 65 I now have over $10,000 in my emergency fund (never had an emergency fund) and have paid off over $20,000 in credit card debt. I am now adding $1,000 to savings every month, with retirement income of just $37,560 per year. I will never pay interest on credit card purchases, I just use them for cash back now, on recurring purchases, food, car insurance, gasoline, utilities, etc. I have 3 credit cards now, that have zero interest on purchases for 18 months. The balances will be paid off before any interest charges accrue. In retirement you need to cover basic needs and emergencies, always adding funds back to the emergency fund if used and wants can wait until you save the cash, to purchase interest free, Living large in Montana with very little financial stress.


    1. You are proof of what can be done. Too many people don’t understand that. No doubt living in Montana helps. Those of us living on the east coast might not make it with those numbers. I live in a condo. The property taxes are nearly $13,000 a year.


      1. Question…if the majority of our property taxes go to public schools then why are the students get scores decreasing…and why is the answer always more tax dollars?


      2. Because the majority of taxes that do go to schools go to the pay and benefits of teachers and staff and we have little way to actually measure performance of teachers and now in a number of cases, not even the proficiency of students.


      3. RD – I lived on the east cost from 1977 until 1995 and fell your pain. But, prices were a lot cheaper during those years. I cannot believe how many people think that they are going to live well in retirement with just Social Security. Getting out of debt is the biggest thing that anyone can do to have a great retirement and they better start eliminating debt by age 50. My 4 adult children have zero credit card debt and are on their way to having a better retirement than my wife and I.


  2. I think for future generations, the costs associated with the Internet of Things will become a big budget item. They may be able to plan and budget for it a bit better then current retirees because it is still evolving for us. I have been able to covered the increasing costs but since my retirement planning days a decade ago to the post pandemic world, the cost for the internet and cells phones is becoming a major budget item. As expressed as a percentage of my retirement income, I don’t feel like it should cost more than my medical. To me, medical is more important.

    It is very difficult to do business with banks, medical providers, medical insurance companies, investment brokers or the holders of IRAs funds, and the government without some kind of internet access. On top of that you need a cell phone to get your verification codes to log in on the internet. Then there is reliable connections, computers, security software, etc… Cell phone plans that are always upgraded meaning that they costs more. There are appliances that won’t work correctly if they are not connected to the internet. I don’t want my stuff all connected but I am getting less and less of a choice.

    Right now about the only thing that I can control is the TV entertainment packages but they are often bundled so that it costs just as much money to get rid of them. Streaming has just added more confusion. But I am willing to cut the cord but my wife is not ready yet. I can’t blame her since we were force to stay house bound for over a year due to the government. What is going to happen when it is our old age that keeps us home?

    I have been able to keep these costs reasonable, but I see that in the future it is going to make for some hard choices for people with less retirement income.


    1. Not that simple. Mik. Some adult children have medical issues, psychiatric issues, disability issues, etc. and they need financial help. Also, if you can afford to give your children some of their inheritance early so that they can enjoy life more, that can be a good thing. Finally, if you can travel with your adult children (and pay for it), that is a wonderful gift both to them and to yourself. None of this suggests that you should support lazy, but it isn’t always lazy.


      1. I agree, children are always your children. Same for grandchildren in some cases. And helping them save for college is a good thing as well.


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