People approaching retirement are likely to think they will spend less when they hang up their hats, but the reality might be a lot different than that according to researchers at Bern stein Global Wealth Management. In Daniel B. Eagan’s opinion, the idea that you will spend less in retirement might be the biggest misconception there is. “It’s hardly ever true, though retirees truly believe it,” he told Business Insider. “Retirees end up spending even more until they’re really old and then they’re home-bound.”

Some of the factors driving their costs up include the rising costs of health care, and medical costs have cast a long shadow over retirement, according to a spring report from Fidelity Investments, and it’s only going to get worse. “A 65-year-old couple retiring this year without any employer-based health coverage would need an estimated $240,000 to cover medical costs through retirement,” wrote Lee Adler. That’s not even accounting for complications like Alzheimer’s. Currently, Americans spend $2.8 trillion on health care each year.

Supporting millennial kids, whether it is helping with student loan debt or providing the down payment for their child’s first home, more retirees are financing relatives’ lives in some way. According to the National Association of Realtors’ “Profile of Home Buyers and Sellers,” 26 percent of first-time home buyers received cash for a down payment from a relative or friend.

Another expense might include funding a grandchild’s education. Grandparent spending skyrocketed between 1999 and 2009 according to Met Life, and it is a trend that will likely continue. In 2009, grandparents said they spent $2.43 billion on primary and secondary school tuition and supplies, three times more than they did a decade prior.

Unless they are seasoned travelers, it is doubtful that most retirees will try to cut corners when they are planning some overdue beach time. Yet these expenses can quickly add up, especially when consumers don’t pay attention. All-inclusive cruises are riddled with fees, from cocktails to offshore excursions, and let’s be honest, traveling abroad hasn’t gotten much cheaper. International fares can easily edge into the thousands.

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About Shahid Barry
Shaid Barry, a financial professional, is President of S. Barry’s Financial Services, Inc. In the business since 1982, his expertise includes all types of life insurance products, disability income and health insurance, mutual funds, annulties, college plans, short- and long term investments with safety features in mind, investments for income, retirement plans and estate Planning. For more information, visit www.sbarryfinancial.com or call 954-970-4558.