BRONWYN L. MARTIN
One of the biggest benefits of retirement is having the freedom to pursue new interests and hobbies in your spare time. For many, travel is at the top of their retirement to-do list. The question is how to make sure your retirement savings can keep up with your travel goals. The following points may help you determine your answer:
Make travel part of your retirement budget. If you don’t have enough money to travel, you probably won’t get very far. When planning your living expenses, include travel as a line item in your retirement budget. Before you set off, designate a portion of your monthly income to cover travel expenses.
Consider travel timing. Many retirees plan their biggest travel trips in the early years of retirement, when they have fewer health problems and greater stamina. Therefore, your travel budget may represent a larger portion of your overall expenses in the early years of retirement. If this fits your travel vision, include it in your retirement budgeting strategy.
Determine your travel style. Determine the types of travel you plan to take to make a reasonable cost estimate. Are you more interested in short trips to nearby places, traveling mostly by car? Planning to explore the country by caravan? Do you want to visit foreign destinations regularly? Your travel goals will tell you a lot about how much you’re likely to spend, which should be reflected in your retirement plan.
Find ways to reduce costs. It’s easy to face “sticker shock” when traveling. Expenses such as food (often eating out), accommodation, and transportation can add up quickly. If you plan to stay in one place for an extended period of time, consider renting a house or apartment rather than “hoteling.” Try to eat like the locals by buying food from markets and markets. Take the time to look for flight deals or make your car travel routes as efficient as possible. One of the advantages of being retired is that you have more flexibility than working people in closing deals by traveling during off-seasons or other unpopular times.
Don’t ignore insurance needs. Travel insurance may be appropriate if you get sick or lose your luggage while traveling. Note that Medicare is not accepted outside the US or even within the US; You want to make sure your health insurance covers you in states other than your own.
Look for discounts and rewards. Seniors have a unique advantage in terms of reduced costs of some activities. While discounts are modest, every dollar helps stretch your travel budget. Check what discounted options are available at clubs like AAA or AARP. Also follow smart credit card strategies that will help you earn rewards like free travel or cash back on your purchases.
If travel is in your plans as you leave the workforce, it’s crucial to go beyond daydreaming and make some significant preparations in advance. Use the time you have now to set specific goals and build savings that will help you make your dreams a reality.
Bronwyn L. Martin is a Financial Advisor and Certified Financial Advisor at Martin’s Financial Consulting Group, the financial asset advisory practice of Ameriprise Financial Services LLC, located in Kennett Square and Havre de Grace, MD. He specializes in fee-based financial planning and wealth management strategies. and has been in practice for over 23 years. To contact him: www.ameripriseadvisors.com/bronwyn.x.martin.