10 Sneaky New Retirement Costs

Retirement often brings new expenses you might not have anticipated.

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Many people think they will be able to live on less money in retirement. Some people say they will only need 70 to 80 percent of their take home pay after they leave their job. You may have fewer commuting costs, no more retirement contributions and mortgage payments, and will theoretically no longer need a second car. But not everyone’s costs go down.

[See 10 Key Retirement Ages to Plan For.]

Not all couples want to give up a second car. When the husband is out golfing or the wife is out shopping or vice versa, the other spouse may want to go somewhere else. And if you haven’t been diligent about paying down your mortgage, you may not be debt free in retirement. For many people, expenses in retirement go up, not down. Here are 10 costs that might sneak up on you in retirement.

Living longer than expected. You could live longer than you initially planned to. And that's a good thing. But the longer you live, the longer your assets will need to last. Make sure you are a bit conservative in your retirement longevity estimates, because you don't want to celebrate your 100th birthday with a retirement plan that has you living only until 95.

Moving costs. With jobs scarce, your children and grandchildren might move to different states or even countries to find work. If living near family is an essential part of your retirement plan, it may mean moving and absorbing the costs that go along with relocating.

Gifts or financial help for children. Don’t automatically offer money to family members, and only do so if you are financially able to. But as you get older and your family grows, the number of people you want to offer gifts to increases. When it’s your grandson's birthday or a nephew graduates, these are happy moments when you might want to chip in.

[See 9 Ways to Save More Money for Retirement.]

Rising health insurance costs. The fact that you are aging means higher health costs. Just the need to take more prescription drugs alone will mean more money spent on your health. Check out these ways to save money on insurance, and, more importantly, be prepared.

Travel. With more time on your hands, you might want to travel to a few of the places you've always wanted to go. The vacation to Italy that you've put off for 20 years may seem like a good idea, but make sure you have this in your budget.

Long-term care. Whether you are going to a nursing home or just planning to hire help, you will eventually need someone to help take care of you.

Upkeep of your house. I highly encourage retirees to downsize for financial reasons alone. However, there will come a time when you are no longer able or willing to climb up to the roof to replace broken tiles. You might love gardening, but mowing your lawn on a humid Saturday might not be high on your priority list.

Higher taxes. Though it's likely that the tax cuts will be extended, there will come a time in the near future when we can no longer put off raising taxes to cover our nation's enormous deficit. Expect less deductions and higher tax rates.

[See 5 Reasons to Work in Retirement.]

Home repairs. Like you, your house is aging too and maintenance bills will gradually increase as time goes on.

Inflation. Retirement planners are getting better at including inflation in retirement calculations. But in reality, no one knows what inflation will be in the future. Being a millionaire heading into retirement would have been awesome 20 years ago, and it's still good now, but who knows how long $1 million dollars will last in 50 years.

David Ning runs MoneyNing, a personal finance site aimed at helping others change their habits for a better financial future. He suggests that everyone to sign up for an online savings account to get more out of our hard earned money.