An older couple sits on a couch and evaluates their budget to prepare for life in a retirement community

5 Tips for Budgeting for Your Life at a Retirement Community

When you hear the word “retirement,” do you get excited? Are you ready to finally be able to stop working and start doing all the things you’ve always wanted to do? Maybe you’re prepared to travel, join a retirement community, spend time with your grandkids, or see some long-lost friends again.

Or does the word retirement give you anxiety? Are you worried about having enough income to cover your daily living expenses, not to mention if something goes wrong with your home? Or what about your health? Maybe you’re worried about being a burden to your kids and wonder if you need to arrange your long-term care strategy.

Either way, you’ve come to the right place. Explore Retirement Living (ERL) wants to help you financially prepare for your life after retirement so that you can enjoy this hard-earned time with peace of mind about your finances and ongoing medical needs.

Tip #1: Consider Moving to a Non-Profit Continuing Care Retirement Community

Continuing care retirement communities (CCRC), or as we like to call them, Life Plan Communities, are an excellent way for you both to be excited about retirement and the freedom it brings while also factoring in your financial situation and ongoing medical needs.

While a CCRC won’t manage your money for you, if you outlive your money or a situation arises, most non-profit CCRC’s wouldn’t ask you to leave. Many CCRC’s have some sort of charitable care option for residents who find themselves in an unavoidable financial difficulty, provided they have not gifted their resources to reduce their assets to qualify for it.

This type of assistance is one of the most significant differences between a non-profit life plan community and a for-profit community. We recommend thoroughly researching the differences and learn about the different contracts to find one that works best for your financial ability and lifestyle.

Tip #2: Analyze Your Budget

As you think about the different contracts that fit your financial ability, you will also want to analyze your budget. Remember that retirement can last for three decades or more, so proper financial planning ensures that you can meet your needs, no matter what phase of retirement you find yourself. To analyze your budget and plan, follow these three simple steps:

  1. Determine your potential income after retirement: Consider how much you may receive in Social Security benefits or pensions. Also, check on the balances in your retirement plans, like 401(k)s, 403(b)s, and/or IRAs, and estimate how much you will be able to withdrawal each month. Some folks enjoy working part-time in retirement, so plan for that income as well.
  2. Determine your likely expenses after retirement: Of course, you’ll factor in necessities like shelter, utilities, food, and transportation. But also consider things like insurance, clothing, fun, travel, medical expenses, gifts, pet care, and planning for emergencies.
  3. Determine where you can cut back and save: No one likes to think about having to cut back on their lifestyle in retirement, but it’s true that nearly everyone has some area in their budget they can reduce. And remember that if you move to a Life Plan Community, most monthly fees cover utilities, security, home maintenance, lawn care, and more, so that can be a way to reduce your expenses.

Tip #3: Plan Early

Determining your likely budget after retirement is an excellent start to preparing for your next phase in life, and honestly, it’s never too early to plan. For our readers under 50, now is the time to start saving and growing your retirement accounts. Take advantage of the power of compound interest to allow your investments to grow with you. You won’t be sorry!

If you plan to retire sometime within the next five years, it’s time to really get serious about planning for your future. In addition to the five tips we covered previously, you’ll want to start considering what life will look like after you stop working. Don’t forget to factor in waitlists as you explore your options. Remember that the worst time to move is during a crisis, and the older you get, the harder it will be to move. Planning now gives you time to set your retirement plans in motion.

Tip #4: Consult a Financial Advisor

As you plan for your future, it’s not a bad idea to consult a financial advisor. They can help you prepare for the financial expenses associated with your retirement and give you a good idea of what income you may receive. Some of the communities in the ERL offer budget planning worksheets to help you prepare for the expenses of living in a retirement community, and reviewing those with your financial advisor can help ensure you feel comfortable with the transition to retirement.

Tip #5: Get a Support Network

Retirement is more than just an event in life. It’s a process that can sometimes take a toll on you. It’s during this time that you especially need people in your life to support you. If you have children, planning for your life as you get older takes the burden off them, but include them in the process, so they know their mom and dad will receive the care services they need.

Ask opinions of other family members and friends too, especially ones who have already retired. They can offer you nuggets of wisdom to plan and budget for this stage in your life. As you consider your ongoing medical needs, a CCRC can provide a continuum of care, such as memory care, skilled nursing, and personal care. Plus, our caring staff can help provide the support you need if you don’t have others in your corner.

Need More Information on Budgeting for Senior Care?

Explore Retirement Living has abundant resources, blog articles, and information about our senior housing communities in the Lancaster, PA area on our website. We invite you to look around our website and explore the different offerings of each community in the ERL. Pay close attention to entrance fees, monthly fees, and other potential expenses of the different retirement communities to see which one is right for you.

Then contact us or any of our communities to find out more information and schedule a personal visit to find the right fit for you. We’d love to help you and plan for your future together. After all, retirement should be an exciting time in your life, not one filled with anxiety. Experience the difference a non-profit CCRC can make for you!