As one approaches 50, budgeting needs to take into consideration the different requirements that one might need due to the our changing needs. I must say, I wasn’t quite ready for these changs so there was some situations that i would have preferred not to get myself into. Having said that, what is done is done so I was hoping this article can help you to be more forward looking in your budgeting as you progress towards your 50s.
Health cost is your top expenditure
I always knew health spending will go up as I aged but I never though it would spike the way it did. Health expenditure is not a linear kind of expenditure. There will be what they called ‘black swan’ events whereby you might suddenly need a large sum of cash to cover medical expenses that were not insured. I remembered when I was dignosed with cancer, there was unexpected expenses that I had to cover up. This left a hugh dent in my budget. So my advice is to set up a large portion for your retirement for such health spending and also to make sure your health insurance coverage is sufficient.
Leaving something for your loved ones
I was never a big believer in insurance (exept for medical insurance) after hearing about all these horror stories from my peers. However, as I aged, I realised that I do want to leave something behind for my loved ones. Fortunately, this now life insurance for over 50 folks so I still have options to prepare something for my wife.
What other the rest of the expenses
The rest of the expenses for me is as follows:
- Food: 20% since I love to eat
- Transport: 10% not so much now as I tend to stat at home unless travelling
- Travel: 30% I love to travel while I still can so this, I will travel as much as I can
- Repairs: 15% House is getting old so there will be a bit of repair work now and then
- Clothing: 5% Higher if you are a female. Not so much for me : )
Be prepared for sudden health expenses coming your way. Set aside a bigger budget for it should leave you in good hands. Remember to get some life insurance for over 50 if you want to leave something behind.