Most retirees spend less on clothing and gasoline because those are employment-related expenses. Analyze Now , offers retirement planning advice and tools. Hebeler says that he used to think the best way to estimate one's spending needs in retirement was to make out a detailed budget. When you're 55 or 65, you can't really see what it's going to be like when you're 75 or 85. He also recommends keeping aside at least a year's worth of living expenses as a contingency fund.
Insurance needs change Still, serious problems can foil even the best-laid plans.
The three major types of coverage that are most worth looking at are long-term care insurance, Medigap insurance and life insurance. Long-term care insurance helps to cover what Medicare doesn't. It's insurance for the middle class. A few Medigap policies also pay for outpatient prescriptions. Life insurance is a third option.