Retirement is an exciting and anticipated milestone for many, but retirees can be unprepared for some of the aspects that go into retirement planning. According to The Wall Street Journal, there are five myths associated with retirement.
Retiring when you expect to. Many retirees are retiring earlier than they expect to, meaning that they aren’t saving as long as they had planned before withdrawals begin.
Working during retirement is easy. Only 27% of those who plan to work during retirement report doing so. Factors such as health issues and job competition make finding jobs in retirement difficult.
Buying a second home. Some retirees purchase a second home with the intention of eventually selling their primary home. Doing this can be more difficult and expensive to maintain than anticipated.
Medicare coverage. On average, Medicare only covers 48% of health costs. Retirees might need Medigap, which is a Medicare supplemental insurance policy.
Expenses will decrease. Out-of-pocket expenses can increase in retirement, and unrealistic budgets are the result of assuming expenses will decrease. Retirees should plan on increased expenses associated with traveling, hobbies and medical costs.