Retirement Planning

Retirement Planning Challenges: Unexpected Demands on Your Money

Published by Bob Gustafson

Retirement Planning Challenges

As you approach your retirement planning, and as you partner with your financial planner, you’ll discover a number of unexpected demands on your retirement funds. These unwelcome ‘surprises’ are simply realities of life in our modern times. But they are challenges nonetheless to your financial outlook in your retirement years.

Some of these retirement planning challenges include:


People are living longer thanks to advances in medical treatments and preventive medicine. Many also focus on healthy lifestyle physically and emotionally. But living longer creates one of the biggest retirement planning challenges.

As wonderful as it is that we’ve made such positive strides in healthcare and treatments, living longer can mean that you may outlive your savings. The idea of living longer, advancing into old age, but not having the money to live as and where you wish is frightening to most people. You’ll want to save enough, and make enough, to live better as you live longer.

Negative inheritance rate

In the past, most people could count on getting an inheritance – whether a small amount or a mighty windfall – from their parents. But this is not the past. Today, most people find themselves instead having to support their parents financially as the parents age. Parents’ homes, bills, debts and even pets could become a drain on your financial power. This creates a stressful and potentially dangerous situation when it comes to your own financial health.


Inflation is like a slow-growing cancer, creeping up on you quietly until it reaches sizable and damaging proportions. Many of our retired clients say they can’t believe how expensive everything is compared to prices from their working years. The growing costs of everything from dwellings to food to travel and self-care put a strain on retirement funds. This is true even when a person lives well within their means, if not below. As inflation swells, so tightens the pressure on your finances now and especially in the future.

Healthcare costs

The costs of healthcare, including prescriptions, surgeries, therapies and wellness supplies have escalated tremendously in recent years, and will likely continue to climb at a remarkable rate. The average couple may face over $200,000 in medical costs in their retirement years. That number could multiply if one or both members of your household face a medical crisis that needs special and extended care.

So a challenge of financial planning is providing enough savings to prepare for unforeseen medical expenses. These expenses can be so dramatic that they threaten your lifestyle and could thus put a strain on your kids’ financial lives if you need their care. This challenge is one that keeps many people up at night as the unknown is how big these medical and hospitalization bills could be. The weight of these unknown expenses can cause even more stress about your financial planning. Do you have enough, will you have enough, to live well or unwell?

Living beyond your means

Each generation that comes up tends to live more and more beyond their means. This prevents you from putting  enough money away for retirement to handle the challenges mentioned here, and beyond them to other particular challenges and expenses. It can be difficult to admit that you’re living beyond your means, and more difficult to adjust your spending down when needed. And it can be doubly stressful if you’re used to indulging yourself, or if your partner enjoys indulging. Lifestyle change may be in order. Increasing savings for retirement may be necessary if you don’t wish to change much is quite essential.

Complex family situations

No one likes to imagine tragedy striking their family, but it’s important to face all potential challenges to your financial strength no matter how upsetting it may be. Your adult child may get divorced and need your support. Your adult child may pass away, leaving you with a grandchild to support. Any number of heartbreaking and complex family situations may arise, significantly impacting your financial situation.

Talk with your financial planner about your current family situations, sharing:

  • How many children you have
  • How many grandchildren
  • Which challenges you typically face with your kids.

While you might think it best to keep quiet about an adult child’s bad habits and shaky marital situation, your financial planner is not there to judge you. You’re being wise in your own well-being, and that of your partner, when you share potential risks to your family’s structure and your own responsibilities. This enables you to prepare financially for whatever may occur.

Even without a tragedy, you may be among the many people approaching retirement age whose grown kids depend on them for financial help, whether it is to:

  • Buy a new house or a car
  • Invest in their new business
  • Help them get through periods of unemployment or underemployment.

Your adult child’s struggles can impact you on so many levels including financially and emotionally. Relationships can strain under the weight of financial needs and resentments. That said, it’s smart to face the challenge: what if my adult child asks me for money? With retirement planning approached with this question in mind, you may be able to help more comfortably, not hurting your own retirement cushion in the process.

Facing these Retirement Planning Challenges

It may be scary to face the realities of challenges to your retirement funds, but it’s far scarier to walk into an unexplored future without having prepared for the inevitable and unexpected challenges ahead.

Here is a helpful podcast sharing more about the challenges to retirement planning, giving you a look at what keeps a financial planner up at night when it comes to those unforeseen and ever-present realities that can shake your financial future: