10 Things You'll Spend More Money On In Retirement

Crossing the threshold into retirement is a major accomplishment. It's the ticker tape at the end of a decades-long race and anyone making it across that finish line successfully has achieved something exceptional. In the modern consumer world, it's not enough to simply go to work each day and earn a wage in pursuit of that final shift or workday. Social Security benefits aren't enough to support the needs of a typical retiree all on their own, so workers will need to spend their wage-earning years setting money aside, as well.

Generally speaking, retirees are told they need to budget for roughly 80% of their pre-retirement income to maintain the same lifestyle hallmarks once they stop drawing a paycheck. But nothing is ever that cut and dry. Realistically, many people anticipate going into retirement and amplifying some aspects of their life thanks to the newfound freedom they have each day. This can ultimately make their budget larger than it was during their working years. Either way, while some expenses naturally shrink once you give up the 9-to-5, others balloon, sometimes significantly. These 10 expense items usually grow once you stop working, meaning you'll need to make sure you've accounted for any potential surprises that might otherwise be waiting around the corner. Understanding how these expenses fit in your retirement planning can help keep your budget afloat rather than succumbing to a heap of newly expanded lifestyle costs.

As a general rule of thumb, Medicare will cover roughly two-thirds of retirees' health care costs. This is a big help, taking a chunk out of an expense that many retirees worry about. A 2026 Fidelity survey found that 81% of savers are acutely aware of the costs of health care in retirement, with the study also finding that expenses in this arena will run the typical retiree over $172,500. Even with Medicare pitching in to cover a significant volume of a retiree's total expense on this front, there's no denying the increased cost of health services as you age. Costs can more than double annually for those in their mid to late 50s compared to a 30- or even 40-something American. Cancer screenings, for one thing, become a consistent presence in older patients' doctor visits while most forms are rare among those under 50. Fortunately, Medicare coverage includes free screenings for a range of cancers, making early detection and preventative care more accessible across the board.

There's also the risk of broken bones, which can become a more prevalent among older people thanks to a wide array of natural changes that take place as you age. Any way you slice it, older Americans need a larger volume of care than younger ones. This comes with increased costs overall, including prescription medication requirements. Boston College's Center for Retirement Research reported that median spending on health care costs for retirees in 2022 was $5,444.

Retirees frequently want to take full advantage of the newfound free time they have available. That's a natural inclination, and there's really no faulting retirees for wanting to utilize this time to chase some of the dreams they previously felt stood at odds with the time constraints that their working life created. Yet, it's important to keep in mind that the retirement lifestyle you prioritize may ultimately determine your financial success in this phase. Overextending yourself to chase after new hobbies and adventures can give you a few years of extreme joy, and many more scraping together financial resources to make ends meet.

One area where this can be particularly costly is in the travel space. Retirees average as much as 10% of their total annual budget on travel costs. Fidelity also found that an "active lifestyle in retirement" can result in a budget as much as 15% higher than others who plan a "less active lifestyle." That can equate to thousands or more in additional spending, but the reality is that most retirees are likely to want to expand the adventure they experience. 59% of retirees plan to travel "expressing a wish to see the world," according to Investopedia. This can lead to overzealous spending on travel, especially in the first years of retirement. Across the board, older travelers are, on average, the biggest spenders in this category. Understanding that the call of new adventure will likely be strong once you retire is the first step in planning for these expanded costs.

Homeownership is exceedingly common among the age cohort enjoying retirement today. In 2025, baby boomers exhibited the highest rate of homeownership among generational divides in America, at just under 80% (compared to Gen X's roughly 73% and millennials' 55% rates, via Yahoo! Finance). This means that the vast majority of people retiring in the near future or who have already crossed into retirement (with the youngest baby boomers now aged 62) will have to think about building home maintenance costs into their retirement budget rather than leaning on a building super or a landlord to foot the bill or organize the work.

Home maintenance expenses are on the rise like many other critical aspects of the contemporary economic situation. Realtor.com reported that structural repair costs had risen by 14.1% from 2022 to 2024, with other specialized maintenance tasks like plumbing increasing at an even sharper pace. Repairs may also become increasingly off limits for older retirees. A 60-something homeowner might have no qualms about climbing up on the roof at seasonal intervals to handle gutter cleanout or relish the task of pressure spraying the driveway every few months. Turn the clock forward another decade and many of these tasks become overwhelmingly laborious or even downright dangerous, necessitating an additional expense to hire a professional to handle the job. Homeownership costs become more expensive over time outside of the maintenance cycle, too, with property taxes and HOA fees coming as just some action items that can stretch a retirement budget just a bit thinner with each passing year.

In addition to big purchases like home improvements, travel, and health costs, lots of smaller budgetary features can also come together to create expanded spending demands for retirees. Leisure activities, for instance, are frequently more commonplace for those who've stopped working thanks to the added free time enjoyed during these golden years. As a result, it's easy for leisure costs to quickly outpace their level of expenses at previous times in your life. Merrill Lynch reports that the typical retiree will end up spending more than they anticipate on these activities, especially in the first few years of retirement.

The added freedom that's unbounded by workplace demand on your time create all kinds of opportunities for new excitement. Retirees might join a golf or tennis club in their local area, getting out to play multiple times every week instead of squeezing in individual tee times or court bookings every few weekends. There might also be a draw to get lunch with friends more often or spend more on tickets to see plays or more live sporting events. Baseball or basketball fans, for instance, might amp up their attendance from a few games every season to weekly trips to their local venue. All of these and more frequently come into clearer focus for retirees thanks to the added free time they enjoy, potentially ballooning the amount spent on leisure activities in the process.

Utility bills are on the rise annually, as it is. JD Power found in 2025 that average utility costs for American households had risen by 41% from 2020. With utility costs increasing for everyone, smart options to save money on your electricity bill and other household expenses as crucial for consumers of any age. But retirees face a more pitched battle in this regard than most. Retirees will spend more time at home than the average worker as a natural byproduct of their daily commitment schedule. Even with a little over 21% of Americans still working from home, as of mid-2025 (via National Association of Home Builders), the typical retiree will still spend more of their free time here than others. With the home serving your needs more often, you'll naturally use your utilities on a more frequent basis.

U.S. Bureau of Labor Statistics (BLS) data from 2022 pegged housing costs as a whole (with utilities bundled in) for those over 65 at $20,362, twice that of the next largest spending category. CNBC also reported in January 2026 that retirees can expect to spend as much as $5,000 per year on utilities alone. This forms the tail end of a much longer trend when it comes to utility costs for retired people. In 2005, the Urban Institute found that utility expenses tend to increase with age, and that household utility bills formed the largest single budget item in a typical senior's itemized expenses, at 9%. In 2015, Urban Institute found this figure to be 8%, and CNBC's reporting maintains the same trend another, roughly 10 years later (at roughly 8.2%).

A financial planner generally operates on a percentage-based fee structure. Clients who enlist professional help to manage their retirement portfolio pay usually somewhere between 0.5% and 1.5% of their principal balance in management fees annually. Given some of the rough targets for savings volume that place an average saver's goal at somewhere between $180,000 and $360,000 by age 50 (going off a three- to six-times salary target with an average income as a baseline), you'll pay anywhere from $900 on the extreme low end to $5,400 to your financial planner for just one year of guidance. That price tag will only increase with time, too. Many savers have a $1 million portfolio value in their sights, and following a few key rules such as leveraging tax-advantaged accounts and minimizing fees wherever possible are crucial support systems to help achieve that aim. For reference, a $1 million portfolio would come with a management cost ranging from $5,000 to $15,000 annually.

This may still be a worthwhile expense to some retirees, regardless of how high the price climbs with their continued contribution schedule throughout the earlier working years. Having this built-in support system can be invaluable to some who don't have the necessary time or bandwidth to deal with the added research and learning required to successfully navigate self-management. But the costs will balloon as you continue saving, potentially reaching a significant amount of outgoing cash from your nest egg.

Moving is frequently thought of as a budget fixer for retirees rather than something that adds new strain to financial balance. This usually involves downsizing, and there can be plenty of value to be found when selling a home that's larger than your needs once you retire. But it's easy to overlook all the expenses that a mover has to incur when performing this change of scenery. Moving without hiring professionals will be an option for some, with Forbes reporting that the bill to hire pros for even short moves can cost as much as $5,000. Older movers may not have this option available to them; however, requiring extensive help from family members or professionals to pack up their home.

There's also the new bill layout to consider. Downsizing may result in some bills shrinking, but it can actually come with increased expenses in other areas. For instance, a smaller home is likely to cost less to heat or cool, but if electricity prices are notably higher in your new location that change may be marginal or even nonexistent. The same goes for water usage, which isn't likely to change much based on the city or town you call home. Then there are other expenses like HOA fees and the typical home maintenance costs outlined previously to consider. All of these can come together on top of the commission you'll pay your real estate agent to sell your old home, potentially bringing the entire transaction far closer to break even than you might expect.

Insurance products increase over time. This is a typical fixture in many Americans' lives, with policies like homeowner's insurance, auto coverage, and other expenses such as life insurance blending together to create a (sometimes) costly safety net that adds monthly premiums to the budget but protects you from the worst-case scenarios. Renewals tend to become more expensive with each passing year, with things like car insurance increasing 18% from 2025 to 2026, on average, according to The Zebra. Rising costs in your essential spending categories can hit hard, especially for a retiree working with fixed income constraints. When it comes to things like car insurance, more people are shopping around now than at any time in recent memory to find rate reductions. This can be a potent tool for policies that exist on short timelines and need to be revisited frequently.

Other insurance costs require a different approach. Life insurance and other, similar policies like funeral coverage operate as long-term contractual arrangements that remain unchanging in their fixed costs for decades, or even the rest of your life. But the longer you wait to buy into long-term care policies, burial insurance, life insurance, and even investment tools for your own retirement like annuities, the more expensive the policy will become. Investopedia estimates that these kinds of additional coverage tools run a retiree around $290 per month, or $3,480 annually. Ethos reports that a typical 10-year, $1 million term life policy would cost a 40-year-old man $54 per month, while the same coverage parameters would run a 45-year old $73 monthly. At 55, that same policy ramps up to $176 per month.

Seniors in retirement will naturally look to replace the workday commitments that dominated their schedule with new, more enjoyable alternatives. Many take up new gym memberships and prioritize other fitness activities in their retirement. While you may ultimately find a senior discount that brings the cost down on these kinds of expenses (making it a good idea to sell your existing exercise equipment before retiring to add flexibility alongside a cost-saving approach), many seniors do in fact spend more on gym and other fitness memberships than they did before retiring. This includes exercise classes, court rentals, greens fees, and more. Depending on the kinds of activities you enjoy, this added expense may ultimately be fairly significant, with the average golf club membership costing $6,000 annually, as an example.

However, there's a major tradeoff worth discussing when considering the expense of "wellness" activities. It's undeniable that exercise of any sort is great for your physical and mental health, and this is true for participants of all ages. But exercise is particularly valuable for seniors, and in some surprising ways, too. Financially, seniors who participate in regular exercise tend to enjoy a budgetary benefit; according to Kiplinger, those 65 and older average $824 in reduced health care expenses annually by exercising. Moreover, those who participated in a high level of activity from an earlier age rather than starting in retirement can expect cost reductions rising to as much as $1,350 per year after 65. If you're only investing in a simple gym membership in this spending category (typically ranging from $10 to $100 per month), the trade may even create a net-positive effect!

Charitable giving has long been an important component of many household budgets. It's been found to be particularly important to older Americans through the years, however. In 2015, Merrill Lynch and Age Wave found that 69% of retirees reported that "being generous is an important source of happiness in their retirement years." They also contributed 42% of all total dollars gifted to charity and 45% of the total volunteer hours accumulated. Roughly a decade later, in 2024, Fidelity reported that an even higher percentage of older Americans (those aged 50 to 80, in their study) said "charitable giving plays a significant role in their lives," at 78%. Importantly, the outlet found that 88% of retirees who volunteer (pegged at 55% of the retired population) "agree that volunteering is a way to remain active," adding some more depth to the value that this practice can bring to a person's life.

The numbers point to increased prioritization of interactions with charitable organizations and gift giving, but they also suggest another reason for increased gifting. Older Americans will often have younger family members that are making their own important life decisions. Many seniors will see the number of grandchildren in their family gradually increase throughout their retirement years, adding to the family tree, potentially significantly if the family is already fairly large. With each new member welcomed into the family there's another person to add to the birthday and holiday gift giving list.