Financial Advisors Share 8 Things Retirees Should Stop Buying After Age 65

When building out a retirement plan, it's helpful to know what you expect to spend annually. According to some financial advisors, there are certain things you should stop buying at age 65. Planning to cut these out of your budget could help you more accurately determine what you'll need for a comfortable retirement.

Let's explore what some financial advisors say you should stop buying at age 65.

Life insurance

"Life insurance typically exists to replace income, cover a mortgage, or protect dependents who can't support themselves," says Alex Langan, financial advisor at Langan Financial Group LLC.

When you reach retirement, it's a good time to revisit your life insurance needs. In some cases, you might decide to cancel the policy altogether or scale it back significantly.

If you don't already have long-term care insurance, it might be a good time to purchase this policy instead, according to Langan.

New cars

"Many retirees no longer drive as much as they did during their working years, making frequent vehicle upgrades can be an expensive luxury," says Scott Schuebel, CFS, AIF, and CEO at Statera Advisors.

Schuebel continues, "Depreciation on new vehicles can consume thousands of dollars annually."

Instead of jumping into a new vehicle every couple of years, consider sticking it out with your current ride for as long as possible.

Disability insurance

"Many retirees continue purchasing insurance coverage they may not need, like disability insurance," says Schuebel.

If you're not working anymore, then disability insurance likely isn't necessary. Canceling unnecessary insurance coverage could free up more wiggle room in your budget.

Large homes

"A large house may have made sense while raising a family, but may become costly and burdensome in retirement due to taxes, maintenance, insurance," says Schuebel.

If you're moving to a new town, definitely consider taking the opportunity to downsize into a space that suits your current needs. Even if you aren't moving too far, it could make sense to downsize into a smaller home to save money on property taxes, maintenance, and insurance. All of those savings could add up to help you stretch out your retirement savings.

Expensive status items

If you've had your eye on an expensive status item, like a designer purse or fancy watch, it might be best to leave it in the store.

"Luxury goods, designer items, and purchases made primarily to impress others often provide limited lasting value while reducing resources available for more meaningful goals," says Schuebel.

If your retirement nest egg is a little lighter than you'd want it to be, passing on expensive purchases that don't add true utility to your everyday life might be the right move.

Vacation homes

Many retirees dream of owning a vacation home. While the idea of owning your own slice of paradise sounds appealing, the realities of owning a second home aren't always quite as glamorous.

"The financial reality is that a second property carries property taxes, insurance, maintenance, HOA fees if applicable, and the ongoing cost of keeping a home running even when nobody is there," says Langan.

The truth is that most retirees won't use their vacation home enough to make owning the second property worth it. An easy alternative is to rent a vacation home when you're ready for a little escape.

New toys with debt

If you've been planning on a major purchase in retirement, it's best to tackle these in cash instead of relying on debt. For example, extravagant trips, home remodels, an RV, or a boat paid for with debt might not be a great option for retirees.

"People tend to want to treat themselves to a retirement gift, however the large payments that accompany these loans can cause major issues," says Curt Scott, CFP®, President and Investment Advisor at Scott Financial Group in Grove City, OH.

Scott continues, "Many times, income reduces in retirement and the new payments, that could have been covered with their earned income while working, become difficult to maintain with retirement income."

Unused subscriptions

It's common to pay for more subscriptions than you actually need. During your working years, you might not have the time to weed through your bank statements to eliminate any hidden subscriptions. But when retirement rolls around, it's time to cancel any unused subscriptions or even pare down your services to a more manageable amount.

"Retirement is a natural point to look at spending with fresh eyes. What made sense when you had a different schedule, different priorities, and a regular paycheck coming in may not reflect where you are now," says Langan.

Langan continues, "A periodic review of where money is actually going, rather than where you assume it's going, tends to surface spending that most retirees are happy to redirect once they see it clearly."

Remember, you can redirect the funds to something else. For example, you might decide to cancel an unused gym membership in favor of a pickleball club.

Bottom line

Of course, only you can decide what you should or shouldn't buy in your golden years. While you might take these opinions into account, you'll ultimately choose how to free up your retirement budget.

If you're on the fence about a big purchase in retirement, consider discussing it with a financial advisor. They might be able to help you decide if it's a good choice for your unique situation.