While some expenses naturally fall away when you stop working – such as commuting, office attire, or saving for retirement – others tend to increase as you settle into your new lifestyle. Ignoring these rising costs can derail even the most carefully constructed financial plan. When preparing your post-retirement budget, be mindful of the following areas where your spending may creep upwards over time.
1. Healthcare and medical cover
Medical scheme premiums are not age-rated, but healthcare inflation typically runs at CPI plus 3%–4% per year, making it one of the biggest long-term threats to retirement income. Beyond premiums, retirees often face higher out-of-pocket costs for hearing aids, spectacles, walking aids, specialised consultations, vitamins, and therapies. Over time, you may also require home nursing, assisted living, or frail care – costs that can be crippling if not planned for. Don’t forget that many gap cover providers charge more from age 65, which is another expense to build into your budget.
Fun fact: Healthcare costs in South Africa have risen faster than general inflation every year for the past two decades.
2. Long-term care and frail care
Separate from day-to-day healthcare, the potential need for long-term care is a major cost driver. Whether it’s assisted living, dementia care, or full-time frail care, fees can run into tens of thousands of rands per month. Many families underestimate the likelihood of needing this type of care, yet it remains one of the most significant financial risks in later life. Having a plan for how to fund these expenses is essential.
Fun fact: According to recent data, one in three South Africans over 75 will require some form of assisted living.
3. Hobbies, leisure and entertainment
Retirement gives you the gift of time – but making use of that time often comes with a price tag. Whether it’s gardening, woodworking, photography, golf, dining out, or joining clubs, hobbies and leisure activities can become more expensive than anticipated. Entertainment costs such as theatre tickets, day trips, or home upgrades to support your lifestyle also add up quickly. Be realistic when budgeting, so you can enjoy your pursuits without guilt.
Fun fact: Studies show that retirees who pursue hobbies and social activities are up to 30% less likely to experience depression or cognitive decline — proving that leisure is as good for the mind as it is for the soul.
4. Pets and veterinary care
Companion animals provide comfort, routine and joy in retirement, but they also bring ongoing costs. Premium food, grooming, vaccinations, and unexpected veterinary bills can all put pressure on fixed retirement income. If you plan to travel, budget for kennelling, pet sitters or dog walkers. Keep in mind that a sudden R20 000 vet bill can be tough to absorb from monthly drawings, so keep sufficient discretionary savings aside.
Fun fact: Pet ownership among retirees in South Africa has increased by nearly 40% in the past decade.
5. Travel and holidays
For many, travel is a top retirement priority. Overseas trips, cruises and safaris often cluster in the early years of retirement when mobility is greater, which means higher expenses in the first decade. Later, local travel may take over. If your children or grandchildren live abroad, factor in the cost of regular international flights and extended stays. Because these trips require large lump sums, plan how you will fund them without upsetting the sustainability of your investment strategy.
Fun fact: Travel spending among retirees typically peaks within the first 10 years of retirement — a trend confirmed by studies from the U.S. Bureau of Labor Statistics and mirrored in South African spending surveys, which show that travel and leisure expenses decline steadily with age.
6. Home maintenance and adaptations
Your home doesn’t stop needing attention once you retire. Roofs, geysers, plumbing, and painting all require periodic investment, often at inconvenient times. In addition, physical changes associated with ageing may necessitate modifications such as walk-in showers, handrails, ramps, widened doorways or non-slip flooring. Even vehicle adaptations, such as modified controls, may become necessary – and these costs should be anticipated rather than treated as emergencies.
Fun fact: Property experts recommend budgeting around 1% of your home’s value each year for maintenance and repairs — meaning a R2 million home could require R20 000 annually just to stay in good condition.
7. Levies, security and community living
If you move into a retirement complex, sectional title unit, or life-rights development, keep in mind that monthly levies can be substantial. Some cover basics like refuse removal and security, while others include meals, clinics, or community facilities. Do your homework upfront so you know exactly what is – and isn’t – included. If you remain in your own home, you may choose to upgrade alarm systems, electric fencing, or armed response contracts, all of which add to monthly costs.
Fun fact: Many South African retirement villages link annual levy increases to CPI plus 2%–3%, meaning your levy could rise faster than general inflation each year.
8. Technology and connectivity
Staying in touch with family, especially if they live abroad, means keeping up with evolving technology. Smartphones, tablets, laptops, software upgrades and reliable internet all come at a cost. Add to that streaming services like Netflix, Showmax, Disney+, and cloud storage subscriptions, and you have a recurring expense that many retirees underestimate. Technology keeps you connected and entertained, but it needs to be built into the budget.
Fun fact: The average South African household now subscribes to three or more streaming platforms.
9. Family support and grandchildren
Retirees often want to support children and grandchildren, whether through helping with school fees, birthday gifts, or experiences. While generous, keep in mind that this can create significant strain on retirement funds if not properly accounted for. Be honest about your intentions to provide financial assistance so these amounts can be factored into your planning – and so that you don’t unintentionally compromise your own financial security.
Fun fact: More than half of South African retirees continue to provide some form of financial support to adult children.
10. Charitable giving and community involvement
With more time on your hands, you may feel drawn to support your church, charities, or local NGOs more actively. While this is a meaningful use of resources, unplanned generosity can quickly exceed what your retirement income can sustain. To avoid guilt or overextension, allocate a realistic annual amount to charitable giving – and remember that donations to registered Public Benefit Organisations may qualify for tax deductions.
Fun fact: According to the Charities Aid Foundation, South Africans are among the most generous people globally — with nearly two-thirds giving to charity and one in two volunteering their time, often after retirement when they have more hours to give back.
Retirement is not just about replacing your salary – it’s about sustaining a lifestyle for decades. Expenses don’t remain static, and in many cases, they increase in ways that are easy to overlook. As such, building a robust, flexible financial plan that accounts for rising costs will allow you to enjoy your retirement years without anxiety.
Have a wonderful day!
Sue
