Retirement Budget – How To Create A Budget
In this section, Carmen and I will teach you to put your budget together. It’s not that hard, so hang in there. Budgets. Retirement budgets. “Double, double, toil and trouble.” Those were the words in general Macbeth’s head. If you feel uncomfortable doing a budget, you’re not alone. Remember that the very notion of a budget is new. Up until a couple of hundred years ago, most everyone tried to survive year to year. Incomes were mostly the food you grew and savings were storable food leftovers.
Today, seniors can plan. But we know that issues around budgeting are tied to some of our worst fears; running out of money, being a burden on family, and having to leave our home. Although most seniors are scared of budgeting implications, Super Agers are fearless. They understand that retirement budgets help us assess and plan for retirement. With this in mind, let’s see what the Super Agers do.
My Income And My Spending Equal A Retirement Budget
Super Agers look closely at their revenue sources and their expenses. We collected this information in the chapters My Income and How Much Do We Spend? Here, we put them together to create a budget. This is a retirement budget that will help us assess what we have now, or might have in the future, a negative income. A negative income simply means that we’ll need to pull from savings to cover monthly expenses. This is like a Profit and Loss Statement.
Household Proft And Loss Statement
Every household has its own kind of profit and loss statement. To clarify, this is simply a calculation of the amount of money taken in (revenue) versus the amount of money being spent (expenses). We always use historical spending for your expense category as a starting point.
Income For A Retirement Budget
Firstly, we look at income. We covered retirement income here. To recap, CarePlanIt divides it into the following:
Expenses For A Retirement Budget
Secondly, we look at expenses. We covered retirement spending (expenses) here. To recap, CarePlanIt divides expenses into the following:
To recap, CarePlanIt divides it into the following:
Putting The Budget Together
Finally, the budget is created by looking at your revenue and subtracting your expenses. It’s shown below.