Retirement: Not Quite As Expensive As You Think

Retirement calculators and 401k charts seem to be creating some sort of anxiety, because the numbers can seem, at times, unattainable. But it’s that anxiety that causes people to change their habits, otherwise we tend to go towards the path of least resistance. It’s much easier not keeping track of your finances and spending everything you earn to live in the now. Tools like Personal Capital’s free financial management tool makes managing our finances so easy that there are no more excuses.

Retirement Isn't That Expensive

While retirement planning can seem stressful, it’s important to understand a few key things about the process, and why you’re probably not as bad off as you think:

1) We always adapt to our income. Just like how a goldfish gets larger or smaller based on the size of his bowl, we most certainly adapt to our various levels of income. Think back to the time when you were a college student, or a 20-something year old with debt. It’s unlikely you were always unhappy because you were poor. Now think back to the time when you made a lot more money. It’s unlikely you were always happy because you were stressed!

2) Commuting costs go way down. When you don’t have to work, you don’t have to commute. Your gas and maintenance bills will go down drastically. You should get less parking tickets and traffic tickets as well.

3) Clothing costs are reduced. There’s simply no need to impress anybody anymore. All you will want to do is feel comfortable. Go through your closet later tonight and look at all the clothes you don’t wear. You’ll be surprised what you find.

4) Entertainment costs get slashed. If you don’t have to work 7am-6pm every day, there are a bunch of free things to do. You can play tennis or basketball at a public park with your friends. There are free museums. The library is a great resource for reading magazines, surfing the internet, and checking out books. There are also plenty of discounts for food (early bird specials) if your time is flexible. Once you’re retired, you actually get to use the resources you’ve been paying for all these years.

5) You’ll meet plenty of other people. One of the biggest fears retirees have is losing their sense of identity. After so many years of producing, making phone calls, and servicing clients, the drop-off can feel very lonely. Have no fear. A lot of people are in your same situation. You’ll quickly get to know a lot of them and form friendships because many are searching for that similar type of support network.

There's Always The Safety Net

While the future of Social Security is uncertain, at this point the average working person can expect about $1,200 a month in Social Security. On top of that, we’ve got a stable government and public services officers to help keep the peace. Plus, we have options to move to a more affordable place to live in retirement. Combining that with our years of savings, life may be quite comfortable.

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