Retirement Planning Questions You May Have Overlooked
Is your retirement planning strategy covering every aspect of your retirement planning years? Learn some things you may have overlooked here.
Retirement planning is all about answering questions that can mold your finances and afford you the freedom to live life the way you want, post-career. And, there are many standard questions prudent would-be retirees answer along that path. Questions frequently home in on expenses, income, health, how much you have saved, what to invest in, and more. And those are all critical questions and considerations. However, there is another matter many might not consider: Where do you want to live? The answer can actually matter quite a lot to your retirement.
Retirement Planning: Where to Retire
There are obvious cost-of-living differences between big cities like San Francisco or New York and smaller towns or rural areas--housing being one of them. But if you know where you want to retire, there are a lot of expenses that can fluctuate wildly based on your location--for example, transportation. According to the Bureau of Labor Statistics, these two broad categories—housing and transportation—accounted for roughly half the expenses of Americans age 65 or over. Folks frequently focus on health care—an important expense, no doubt—but overlook transportation costs, which can be more than health-care spending for some seniors.
MORE: Read our free guide, Premiere Retirement Destinations, where we we rank 8 cities based on reasonable cost of living PLUS overall quality of life.
Retirement Planning: Factors to Consider
Retirees and future retirees have a lot to think about when it comes to choosing where to spend their retirement years, especially considering the financial impact a given location may have.
When making a decision on where to live, consider these ancillary questions:
- What kinds of activities do you enjoy? Are these available in your targeted retirement area?
- Will you have transportation options? If you live in a big city, you may have many, including some public-transit options. If in a rural area, you may have few (if any).
- What other services can you avail yourself of?
Retirement Planning and the Digital Age
The last question is an interesting one to ponder. As MIT Professor Joseph F. Coughlin recently wrote in The Wall Street Journal, technology has the power to fundamentally change the way retirement looks. In today’s digitized day and age, there is a vast array of services at your disposal if you live in a large city. For example, online retailer Amazon is launching delivery services in major cities that will bring small appliances, household goods and even food and wine to you in a matter of hours. A slew of grocery delivery services will do the same. Ride-sharing firms can offer you the ability to easily and quickly get around town. There are online services that will run errands for you and ever so much more.
It is highly likely these service offerings will become more robust and user-friendly for everyone in future years, including retirees. And for retirees, particularly those who are immobile or in poor health, these sorts of services can offer a margin of independence that wasn’t fathomable just a decade ago. Today, these services are limited to larger cities, so location matters there, too. Ultimately, we figure the reach of ride-sharing firms and delivery services will extend into more towns and smaller cities, but that is a forecast and not reality today.
These kinds of considerations matter because, if you are retiring today, you may spend 30 or more years in retirement. Being in control of how you want that time to look is important, and place plays a big role.