Preparing a budget for retirement

How can you go about leading a peaceful retirement life?

14:14 15 November 2013

Thinking about retirement can be exciting and stressful, especially if you are unsure of how to approach the required planning.

Part of retirement means accepting a pension rather than your original salary, which means your budget will be tighter. Learning methods of decrasing the potential financial stress of retirement are essential to make sure you are getting the most out of your golden years.

 

Here are some aspects of living that will be impacted by your retirement:

 

• Access to supplemental income will become available. Examples of this are pension credit for low income individuals, free use of public transportation, no cost National Health Service (NHS) prescriptions and vision exams once you are the age of sixty, access to free television license at the age of seventy five, and the Winter Fuel Payment. Anyone planning for retirement should consider how these benefits can ease financial pressure. 

 

• Insurance costs will change once you enter retirement age. You may experience lower cost home insurance and you may be able to get rid of your income protection insurance. Some insurance payments may become more expensive, such as life insurance, medical coverage, or automobile insurance. 

 

• Being in your home more may mean an increase in your household bills, so be prepared to see an uppage in your gas or electric bills. However, since you will be at home, you may be less likely to buy lunch out, fuel for commutes or have to purchase work clothing. 

 

• Many communities have low cost leisure activities to provide seniors with inexpensive entertainment that will enrich their lives. 

 

Retirement planning can be overwhelming. Educating yourself on what areas of your budget are going to change and planning accordingly can help you to prepare for a successful retirement. You can also talk to other seniors to see how they approached the financial aspect of retirement planning and take advantage of any advice they have to offer.