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Figure out your expenses in retirement

See what new expenses you might have once you retire—and which ones you can forget about.

Potential new costs to consider

Health care expenses

Once you reach age 65, you qualify for Medicare, the federal health insurance program. But you'll still have deductibles, copays, and coinsurance based on your income and the plan you choose—along with expenses not covered by Medicare, like dental and vision costs.

You may also decide to supplement Medicare with Medigap insurance. And consider buying long-term care insurance if you haven't already.

Of course, if you're retiring early and you're not covered either through retiree health benefits from your former employer or through a spouse's health plan, you'll need to plan for that as well.

Lifestyle expenses

If you're planning on taking up new hobbies or traveling, remember to include these costs in your budget.

Expenses that might go down in retirement

Many people find that they cut these types of costs once they retire:

  • Gas, clothing, and other work-related costs.
  • Payroll taxes.
  • Income taxes, if your income is lower than when you were working full-time.
  • Certain lifestyle expenses, if you plan to cook more instead of eating out, for example.
  • Debt payments, if you paid off your mortgage or other loans before retiring.
  • Life insurance, if you decide to drop it once you retire.

Make your retirement budget

Our retirement planning worksheet makes it easy to get a complete picture of your retirement budget.

What's next?

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