10 Ways to Prepare for Financial Curveballs in Retirement

Whether you are preparing for retirement or are well into your retirement years, it's helpful to realize that the potential to experience financial curveballs never ends. 

But with a bit of understanding and planning, it may be possible to prevent those surprises from throwing your retirement entirely off track.

Keep reading as we explore potential issues that can arise in your retirement, including some helpful ways to make the right money moves so you can be prepared for whatever comes your way during your golden years.

Even if you own your home outright, rising property taxes can push your housing costs higher, even if you already own your home.

If you haven't retired yet, be sure to factor rising housing costs into your retirement spending plan. And, if you've already retired, look for areas of your budget to cut back on to make up the difference. For example, you might spend less on travel to cover the higher cost of living.

The cost of medical care is undeniably expensive for many. As you age, it's likely that you'll run into more medical bills over time. Even if you have healthcare coverage, it's possible that your policy doesn't cover everything related to your ailments.

Depending on your situation, health expenses could cost thousands of dollars per year. In order to avoid too many unexpected costs, consider purchasing a Medigap policy to help you cover medical expenses that Medicare won't cover.

Long-term care expenses can add up quickly. Although it's tempting to assume you'll never need this extra level of care, the U.S. Department of Health and Human Services estimates that almost 70% of 65-year-olds will eventually need some type of long-term care at some point in their lives.

A nursing home stay can cost thousands of dollars per month, which can drain any retiree's savings quickly. If possible, purchase long-term care insurance coverage to help pay for these costs when you need them.

Although many parents expect their children to take care of themselves at some point, some retirees find themselves stepping in to help an adult child in financial distress. If you find yourself feeling the need to help your adult child with financial problems, take a careful look at your own nest egg before moving forward.

If you don't have the funds to help your child and maintain an acceptable standard of living in retirement, then do your best to help in non-financial ways. For example, you might offer to help your child out with childcare by watching your grandkids instead of paying for daycare costs.

Homeowners of all ages can feel the pinch of an unexpected home repair. Even if you are retired, surprise home projects can throw a wrench in your financial plans.

In the lead-up to retirement, make an effort to plan ahead for upcoming home issues. For example, if you know the roof is nearing the end of its useful life, consider saving up for its eventual replacement before jumping into retirement.

Losing a spouse has devastating consequences. Beyond the obvious, this can also impact your finances.

It may be a hard or painful conversation to have, but you and your spouse can help prepare for the unthinkable by looking into life insurance policies, or establishing what each of your survivor benefits would be on any retirement or Social Security plans.

Although many plan to work up to their designated retirement age, like age 65, that's not always possible. In some cases, your health might not allow you to continue working to your target retirement date, or you could be laid off and unable to find another job.

If you must retire before you are financially able to, consider pulling back on your expenses to stretch your existing savings further. Additionally, consider picking a part-time job that suits your health needs to bring in some supplemental income.

If you've dreamed of traveling far and wide during your retirement years, those costs can add up quickly. It's easy to underestimate how much you'll spend on traveling in your golden years, especially if you want to see exotic places or enjoy more luxurious vacations.

Get realistic about your retirement travel goals. Look for ways to maximize your budget. For example, you might choose to travel slowly and spend long stretches of time in a place to keep your transportation costs between places low.

As inflation pushes prices higher, retirees are often forced to make difficult choices. After all, you planned to retire based on your expenses. But if your expenses rise due to inflation, that can make things tight.

In order to combat inflation, your investment portfolio may be your biggest tool. With the appropriate investments, you can put your funds to work on outpacing inflation.

When you retire from the working world, it's common for some retirees to completely avoid the possibility of working for money ever again. But if you want some extra cushion in your retirement years, picking up extra work that you enjoy or offers a lucrative payday could be worth it.

For example, you might opt to work part-time in a completely different industry to supplement your Social Security income. Or you might pick up consulting work in your previous industry and collect premium rates. Generally, it's a mistake to completely ignore the possibility of earning some extra money if you experience a curveball in retirement.

A completely stress-free retirement might not be possible. But you can set up your finances for flexibility and take action to protect yourself throughout your retirement years by planning ahead for some common retirement curveballs.

Not sure where to start? A financial advisor can help you take a look at your existing situation and identify some areas where you may be vulnerable.