9 Reasons Your Spending May “Suddenly” Increase in Your 70s

You may think retirement planning means assuming you’ll spend the same amount each year. 

However, there’s a concept called the retirement spending smile. It emerged about a decade ago and suggests that expenses often decline in early retirement and rise in later years.

Based loosely on that concept, here are eight reasons why your spending may increase in your 70s and how to maximize your retirement savings.

This is going to vary from person to person. You may be in good health for the first part of your retirement, able to move around and do what you want — or you may have some health issues as you enter retirement. 

Either way, you may see increased healthcare costs as you enter your 70s. You may have options such as Medicare and other programs to help cover increased costs.

You may be looking forward to that free time in retirement. Many people look forward to the opportunity to enjoy their days without the hours of a regular job. You may enjoy things like travel and hobbies, which can add more expenses to your regular spending.

This could be especially true in your 70s, during your early retirement years. For many of these expenses, you may find it helps to add additional money to your spending budget for these items and possibly make cuts elsewhere.

Once you hit retirement and have more free time, you may want to fill some of it with travel. Maybe you want to take some trips you hadn’t had time for earlier in life, or you may want to see your loved ones. If you’re still in good health in your earlier retirement years, you could have the desire to make the most of it and see new places and experience new things.

You may adjust your budget to accommodate for increased travel expenses, but travel doesn’t always need to be expensive — you can seek out deals and discounts, or, if you’re going to be traveling a great deal, consider cutting back some expenses at home, like streaming services or subscriptions.

You might know people who have bought a vacation home in retirement. If you have a special place you like to visit, it may make financial sense for you to purchase another home there.

This may be a good idea in your earlier retirement years, when you're in good health and eager to spend time away from your primary home. Ideally, you’ve put aside money for this reason, but you can also consider renting out either home when you’re away to offset some expenses.

Speaking of homes, you may see increased maintenance costs as you age, especially if you have multiple homes.

If your primary residence is older, it may require more repairs and maintenance as the years go on. Some of these may be pretty costly and may also be things you can’t do yourself, like replacing a roof or water heater. 

If you have mobility concerns, you might find your home needs upgrades there as well, making it a good idea to set aside an emergency fund for such major expenses.

You may not have had the money to regularly dine out and enjoy fine restaurant meals in your adult years, but once retirement hits and your expenses have settled down, you might find more time and money to enjoy additional meals out.

Again, if you’re in good health in your 70s and have more free time, eating out by yourself or with loved ones can be a form of self-care. However, you might need to adjust your budget to accommodate more outside meals. You could also look for deals and discounts to help keep your spending in check.

You may find more time for hobbies you enjoy or take up new ones as you enter retirement. While many hobbies require little money, you could find some with bigger costs. 

As long as you’re in pretty good health and have more free time with no regular job, you can find a variety of hobbies to help you fill your time, be social, and keep your mind working.

While you can adjust your budget to include more money for hobbies, many community and city resources offer free or inexpensive activities, groups, and classes for seniors.

This may be a habit that follows you in retirement. Perhaps you’re the consumer who does mindless spending when you’re bored. It can be a fun way to pass the time. Again, you could put a little money aside in your budget or an account just meant for this spending.

If you don’t use it during that budgeted time, you could reward yourself and put it into a different place in the budget or keep it as savings. This might even be a way to persuade yourself to spend less.

You can see how your spending may increase as you move through your retirement years. Investing at least some of this into your retirement budget may be a good idea.

Perhaps you can figure out what’s most important to you and what you want to finance when you retire. Looking at your budget sooner rather than later and identifying any areas to cut back on spending might be helpful since you may find it easier to make cuts earlier and keep them in place through the years.

It could be helpful to remember that your spending may vary during your retirement years, and your retirement plan may need to change periodically.

You may see an increase in your 70s, thanks partly to higher spending on healthcare, travel, and lifestyle changes. It might be helpful to consult a financial planner to budget for these years of possible increased spending.