A digest of timely information and insight about finance, investing, and retirement.

The big, surprising cost in retirement no one plans for, but should | Forbes
For most older Americans, driving is not a choice, it is a necessity. Transportation is often taken for granted but it is critical to living well at any age. Yet most people, including many financial advisors, are surprised to learn that transportation is the second largest cost in retirement. According to the Bureau of Labor Statistics, the top five expenses for people 65 years old and older are housing, transportation, health care, entertainment, and food. Transportation costs an average 65-year old head of household more than $7,100 a year compared to health care, which is often, and incorrectly, identified as the second greatest expense in retirement at $6,300 annually.

As retiree health care costs soar, public employers turn to private insurers | Governing
The cost of retiree health care is spiraling out of control. In just two years, according to a recent S&P Global Ratings report, unfunded retiree health care liabilities across the 50 states increased by $100 billion to now just under $700 billion. In response, some public entities are scrapping government-sponsored health plans and instead paying for retirees to purchase a plan on a private health insurance exchange. The change is expected to save some cities hundreds of millions of dollars and make their annual retiree health care costs more predictable.

Whyyou should take a vacation in retirement | US News
While many people imagine retirement as a permanent vacation, it isn’t. Retirement is more like a stay-at-home vacation. You’re not going to work, but you still have all your usual responsibilities, whether it’s taking care of the house and yard, doing your volunteer job or taking care of grandchildren. To really relax and take time off, you have to get away from home.

This retirement plan feature can help save on taxes—if you can find it at work | CNBC

If you’re looking for a strategy to slash your tax bill in retirement, your employer just might have the answer. You’re probably familiar with the traditional 401(k) — the workplace retirement savings plan where you can stash pretax dollars and have them accumulate on a tax-deferred basis. What you may not know is that many companies are now offering a Roth 401(k) option as well. You can stash after-tax dollars in these accounts, have them accumulate free of taxes and take tax-free withdrawals in retirement, provided you meet a set of conditions.

Howall 50 states tax retirees | Kiplinger
Retirees relocate for lots of different reasons, from the weather to proximity to grandchildren. Moving from a pricey part of the country to one with low housing prices could also lower your expenses and make your retirement savings last longer. But as you consider the cost of living in potential retirement destinations, don’t overlook the impact of state taxes on your bottom line.

The big problem with 56 percent of people retiring earlier than expected | Yahoo Finance
Early retirement is far more common than people realize, and it’s often unplanned. Retiring early may sound like cause for celebration, and it is for some, but for many people, early retirement can strain finances and cause stress. Few people who retire ahead of schedule do so because they can afford it. According to a recent Transamerica survey, 56 percent of retirees reported retiring earlier than they had planned. Of those, only 11 percent did so because they had saved enough money — the rest citing employment-related reasons like job loss or family and health-related reasons like an illness or sick family member.