Retirement Budget at Age 70 vs. 80: 5 Budget Breakers That Show Up Late
You might think that once you’ve safely settled into retirement there aren’t many surprises for which you haven’t planned. If there are preexisting health concerns, they’re probably already slotted into your budget and spending on entertainment, transportation and travel normally declines with age.
However, a retirement budget that worked well at age 70 may look completely different by the time you reach 80. Costs rise with each passing year and financial strain can come out of nowhere. Here are five budget breakers that you should be aware of as you grow through your 70s and into your 80s.
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1. The Cost of Healthcare
A healthy couple between the ages of 65 and 74 spends over $13,000 annually on medical expenses, according to RBC Wealth Management data. Between the ages of 75 and 84, that annual cost increases to $23,000 and at the age of 85 it reaches $40,000.
Healthcare costs increasing as you age from your 70s to your 80s shouldn’t come as a surprise. However, seniors not budgeting properly for increases is baffling. Healthcare costs typically rise faster than inflation in the U.S. and as KFF reported, higher healthcare spending doesn’t necessarily result in better results.
“Part of it is denial. Healthy people don’t want to think about what life will be like when they’re older and not as healthy,” said Griffin Geisler, wealth strategist for RBC Wealth Management.
Additionally, public health insurance and care programs like Medicaid, Medicare and Program of All-Inclusive Care for the Elderly (PACE) don’t cover all expenses, leaving seniors without comprehensive plans to pay out-of-pocket as they age and new ailments arise.
2. Long-Term Healthcare Plans
People are living longer due to progresses in medical treatment and technology and like regular healthcare, long-term care (LTC) is something that a 70-year-old might not need but an 80-year-old may.
Whether you require assistance at home, community services or long-term care in a nursing home or assisted living facility, you’re going to pay dearly. According to SeniorLiving.org, the median monthly cost for a semiprivate room was $9,842 in June 2026 and $11,294 for a private room. Annually, that’s $118,104 and $135,528, respectively.
LTC insurance can help, but like any insurance, policies vary in coverage benefits and restrictions. Some only cover certain care requirements and conditions and options differ depending on where you live, per AARP.
3. Insurance Rate Increases
Policies can be unpredictable depending on a variety of factors. What’s not is the price of premiums, which will increase eventually and whenever an insurer can justify a rate hike for certain classes of policyholders. “That could be everyone who bought a particular policy in [a] specific state with specific policy features,” according to the American Association for Long-Term Care Insurance.
The same goes for car insurance, if you’re still driving. And home insurance, which is something you’ll need to keep your eye on if you’re still living in your home into your 80s. Not only can premiums increase periodically, but you’ll probably need to expand your coverage as you get older.
4. In-Home Services and Maintenance
Kudos to those who’ve been fortunate to remain at home throughout their 70s and 80s. But like a body, a home ages and needs regular maintenance and major repairs, both of which increase in price all the time. Eventually, a major appliance, plumbing, furnace or roof needs to be replaced.
There are loads of other home healthcare services that will be required as you age from 70- to 80-something, according to the National Institute on Aging (NIA). There may come a time when a homeowner will need first-floor living arrangements implemented, along with ramps, walk-in showers, stairlifts or other accessibility improvements.
Also, help with “activities of daily living” — things like grocery shopping, gardening, laundry, bathing, dressing, meal services, emergency alert systems, respite care and mental health professionals — need to be considered as one ages, per the NIA.
5. The Rising Cost of Living
Finally, while money spent on travel, transportation, clothing and entertainment may decrease during your twilight years, most everything else in life will increase. Even small increases in food prices, utilities and other essentials can negatively impact your purchasing power and bust a budget based on a fixed income.
The annual Social Security cost-of-living adjustment (COLA) helps with the rising costs of consumer goods, however, many retirees also rely on pensions for their income and those either aren’t adjusted or are capped.
You won’t be able to establish your retirement expenses from year to year. However, “[t]he goal isn’t perfection — it’s a plan with buffers (extra room in your budget) and clear income sources that help you adjust as life evolves,” according to Transamerica.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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