Achieving the Dream: Curbing Unexpected Retirement Costs

BOSTON (TheStreet) -- Cars, home appliances and the rising cost of college tuition are among the savings-depleting expenses many of those in, or approaching, retirement may not be adequately preparing for.

According to MainStreet's recent poll on the New American Dream, done in partnership with the National Endowment for Financial Education, 47% of Americans say their primary financial goal is having enough money for retirement.

Many do not "do a very good job of is estimating what they will spend in retirement," says Steve Johnson, a Boston area financial consultant for Charles Schwab (Stock Quote: SCHW).

"People often vary on the extremes," he says. "We'll have clients who saved their entire life and have a very large nest egg but are always fearful about spending that. Then, conversely, you have those who really want to maintain the lifestyle they had in their 40s and 50s but don't have enough money. A lot of people don't have a target of how much they are rally going to need in retirement, and they really don't have a plan."

Health care and long-term care needs are expected by many, but often underestimated given their exponentially rising costs.

Housing is another expected expense that may be under-assessed. Property taxes, and how they will increase over the years, need to be part of the equation. An aging house, coupled with Mother Nature's fury, can mean-larger-than expected maintenance and repair bills.

"This has been a brutal winter. There have been a lot of storms, and people are now forced to add to their housing expenses in terms of costs for damage that has occurred because of the ice and the snow," Johnson says.

Utility costs are another rising expense that may not get enough consideration, as illustrated by the current, unforeseen spike in oil prices.

"If people do their budgeting, they might go look at how much they spend on utilities, food and various expenses," says actuary Steve Vernon, author of Recession-Proof Your Retirement Years: Simple Retirement Planning Strategies That Work Through Thick or Thin. "They forget they are going to be retired for 20 to 25 years or more. They are probably going to need one or two more cars during that time; they might need to replace the roof, or the washing machine might go out. All these unexpected, but big, things can happen. Look back over the past 20 years. How many cars did you buy? How many washing machines did you need to replace?"

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