Top Retirement Expense: Your Home
September 22, 2014
According to a new report by the Employee Benefit Research Institute, home and home-related costs are the biggest expense for people 50 and older. These costs include mortgages, property taxes, homeowner or renter's insurance, rent, utilities, home repairs, furnishing, cleaning supplies, housekeeping, laundry, etc.
- These costs account for 40 percent to 45 percent of household budgets.
- In 2011, people ages 65 to 74 spent an average of $18,720 on home and home-related expenses and those aged 75 to 84 spent $14,732
- On the other hand, health expenses increase with age.
- In households with at least one member between the ages 50 to 64, 8 percent of the household budget was spent on out-of-pocket medical expenses.
- This percentage increased to 19 percent with households that have people aged 85 or older.
The dollar amount may go down with age as older people spend less money on extraneous expenses, like transportation and entertainment, yet the share of the budget that goes toward household and household-related costs stay the same.
Another report from the same institute found that 36 percent of workers have less than $1,000 in savings and investments that can be used for retirement, not counting primary resident or defined benefits plans.
Source: USA Today, "Top retirement expense: Your home," September 17, 2014.
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