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Life Stages: Pre-Retirement


    Budgeting for your retirement lifestyle

    4 min read

    As you start planning for your retirement, one of the questions you may be asking yourself is “do I have enough money to retire?” The answer depends on the cost of the retirement lifestyle you envision. That entails creating a detailed, realistic retirement budget. What’s your retirement plan? The retirement lifestyle you envision will be impacted by how much money you spend and how much money you’re bringing in.

    Ask yourself the following questions:

    • What are your retirement goals and dreams?
    • Do you have a pension or investments?
    • Will you keep working?
    • Do you intend to travel?
    • Do you have other sources of income?

    Start by examining your spending today and think about how that might change in retirement.


    Will you be mortgage-free when you retire? Do you plan to stay in your current home or downsize? You may want to consider the following expenses:

    • Rent, mortgage payments or condominium fees
    • Property taxes
    • Maintenance
    • Home insurance
    • Utilities


    If you own a car or two, will you keep them in retirement, get by with only one (you may no longer be commuting to work), or get rid of your cars and use a carshare or rideshare service or public transit? If you decide to own or lease a car, consider these expenses:

    • Car loan/lease payments
    • Insurance
    • Gas
    • Repairs & maintenance

    Note: In most areas, seniors get a discount on public transit fares.


    Travel is, of course, discretionary and expenses depend on whether you plan to spend most of your time close to your home or cottage, or if you plan to travel abroad. Think about where and how often you intend to travel, and consider the associated costs per year.

    Food, entertainment, and other discretionary expenses

    Depending on the retirement lifestyle you choose, you may want your budget to take into account entertainment and restaurant expenses. Some forms of entertainment, like going to the movies, can be cost-friendly for seniors. With more leisure time in retirement, you may be able to take advantage of discounted rush tickets to the theater, opera or ballet. You may also want to budget for club memberships (gym, golf, tennis) and other hobbies.

    Work-related expenses

    If you’re no longer working, you’ll save money on commuting, clothing and lunch expenses in retirement.

    Financial and other fees

    If you’ll be retiring debt-free, you don’t need to budget for debt service payments. If you’re over 60, you may be entitled to a discount on banking fees, as well as dues if you belong to a professional or trade association.

    Health care and Insurance

    Don’t forget to budget for the rising cost of health care as you get older. It’s also wise to review and update your health, disability, life, and critical illness insurance policies.

    Save more

    Canadian Association of Retired Persons (CARP) is a non-profit organization for seniors. Members save a substantial amount of money every year things like insurance, travel, phones, fitness, and household services.

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