Retirement is something many of us dream about. A time to finally relax, travel, or spend more time with family. But while the idea sounds great, the reality can be a bit tricky, especially when it comes to money.
Let’s talk in plain and friendly terms about some of the most common financial problems people face in retirement and what can be done to stay on top of them.
Running Out of Money
One of the biggest worries retirees have is simple: “What if my money doesn’t last?”. In retirement, you stop getting your wages but your expenses don’t stop. You still need to pay for food, housing, medical care, and maybe even help your kids or grandkids sometimes.
This happens because:
People live longer than expected.
They underestimate how much they’ll need.
Inflation eats away at their savings.
What can help:
Start saving early (even small amounts help!).
Work with a financial adviser to keep you on track (crude plug, Marco!).
Build a retirement budget.
Consider Delaying Retirement Or Working Part-Time.
Rising Healthcare Costs
As we age, we tend to need more care and that care isn’t cheap.
Medical insurance can help but may not cover everything (especially as we get older) and it can also become eye-wateringly expensive
Why this is a problem:
Medical expenses often grow faster than regular inflation.
A serious illness or long-term care stay can wipe out savings.
What can help:
Consider a supplemental insurance plan.
Look into long-term care insurance while you’re still healthy.
Stay active and healthy to reduce risks.
Market Ups and Downs
Many retirees depend on investments and personal pensions or workplace pensions for their financial security but markets can be unpredictable. I wrote a blog last month about this here. A big drop right when you retire can seriously hurt your savings.
Why this matters:
If you pull money out when the market is down, it may take ages to recover.
Investments carry risks (not all these risks are equal).
What can help:
Shift to more conservative investments as retirement nears to protect what you’ve got.
Don’t panic during downturns. Have a plan and stick to it!
Have an investment strategy that matches your risk tolerance (there’s Marco’s plug again!).
Housing Costs
Even if your house is paid off, there are still taxes, maintenance, and insurance. And if you rent, prices can keep rising. Some retirees also downsize too soon or too late and regret it.
What to think about:
Do you really need as much space?
Could downsizing free up money?
Would moving to a cheaper area help?
What can help:
Weigh the emotional value of your home against its financial value.
Consider aging-in-place upgrades if staying put.
Research senior housing or 55+ communities.
Debt in Retirement
Many people retire while still carrying debt whether that be credit cards, mortgages, or student loans (sometimes for their kids!).
Why this causes stress:
No income + monthly payments = financial strain.
Interest adds up fast on credit cards.
What can help:
Try to pay off as much debt as possible before retiring.
Consolidate loans or refinance at lower rates.
Avoid taking on new debt unless absolutely necessary.
Helping Family Too Much
It’s natural to want to help kids or grandkids, perhaps with university, weddings, or emergencies. But if you dip into retirement savings too often, you may find yourself needing help later on.
Friendly reminder:
You can take out loans for college, but not for retirement.
What can help:
Set limits with love.
Offer time or support instead of cash, when possible.
Talk openly with family about what you can and can’t afford.
Not Planning For Longevity
Many people think they’ll live until 75 or 80 but more and more people are living into their 90s and beyond. That’s great news for health but not so great if your money runs out at 80.
What can help:
Plan for 25 to 30 years of retirement (just in case!).
Consider annuities or other products that offer guaranteed income.
Keep a close eye on your spending versus your income.
Final Thoughts
Retirement can be a wonderful chapter but it takes planning, honesty, and a bit of flexibility.
Here’s what you can do starting today:
Review your savings and expenses.
Educate yourself a little each month.
Take care of your health (it’s one of the best “investments” you can make).
See you soon!