Retirement Planning Made Simple: How I Budget, Manage Debt, and Build a Fulfilling Future
When I talk to people about retirement, the conversation often starts with money but it’s never just about money. Retirement planning is about building a vision for the next chapter of your life. How do you want to spend your time? Where do you want to live? What will get you out of bed each morning with purpose? I’ve seen too many people step into retirement with a full portfolio but an empty calendar, and that can lead to boredom or even depression. Writing down goals, talking them through with a spouse, and considering family, hobbies, and social connections are just as important as the numbers.
Of course, the numbers do matter. That’s why I always stress the need for a retirement budget. It’s about knowing what you spend today and what you’ll likely spend tomorrow. Say you want to live on $90,000 a year and you already have $40,000 in fixed income from Social Security or pensions—that leaves a $50,000 shortfall. A $1 million nest egg could cover that at a 5% withdrawal rate, but I’d much rather see you closer to 4% for safety. And don’t forget to budget for unexpected expenses: helping an adult child in crisis, medical costs for parents, or a big vacation you’ve always dreamed of.
Debt is another area I see people overlook. Entering retirement with a mortgage or car loan can strain your cash flow, especially when interest rates rise. Eliminating debt is ideal, but if that’s not realistic, refinancing to a longer term with lower payments can be a smart move. What you don’t want is to focus so much on paying off debt that you neglect saving. Being debt-free doesn’t help if you don’t have enough left to live on comfortably.
Spending patterns also shift during retirement. Early years are often about travel, hobbies, and fun which means higher spending. Later years tend to bring higher healthcare costs. Fidelity estimates a couple at 65 will spend about $295,000 on healthcare over their lifetime, or roughly $5,000 per person per year. Planning for these transitions is key so you don’t assume expenses will naturally decline with age.
Social Security is another cornerstone of retirement income. The decision of when to claim benefits 62, full retirement age, or 70 can make a big difference. Delaying may mean more money in the long run, but your circumstances, health, and lifestyle should guide your choice. It’s not one-size-fits-all.
Then there’s the hidden gem: Health Savings Accounts (HSAs). Too many people leave their HSA in cash when they could be investing those funds for future medical expenses. An HSA is tax-deductible going in, grows tax-deferred, and withdrawals for healthcare are tax-free. That’s a triple win, and one of my favorite tools for retirement planning.
Charitable giving is another area people often wrestle with. My advice is simple: if giving brings you joy and you have the resources, consider doing it while you’re alive. You’ll see the impact firsthand and potentially benefit from tax deductions through strategies like donor-advised funds. Of course, leaving money after death is still an option, especially if you’re worried about unexpected expenses.
Ultimately, retirement readiness isn’t just about having enough money it’s about having clarity. That’s why I encourage people to use resources like a Retirement Readiness Guide, where you can map out budgeting tips, strategies, and next steps. A clear plan doesn’t just prepare you financially, it gives you peace of mind so you can focus on living the retirement you’ve imagined.
Intended for educational purposes only. Opinions expressed are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Neither the information presented, nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Consult your financial professional before making any investment decisions. Opinions expressed are subject to change without notice.
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• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.
• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.
• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.
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• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.
