Realistic budget for travel and health in retirement?

[skyking1]

It is easy to stay safe and RV travel in covid times. Go for it NW!! We love it, our own home own bed happy pets.

 

[Midpack]

If a couple intends to travel domestically (4/5 times a year) and internationally (once a year) in retirement, how much should they budget for travel?.

This thread has been useful, as the range of 20~30K for that kind of travel is the real world spend for many of you, and sort of what I was figuring for.
Thanks again, I love this place.

It’ll be a happy coincidence if your travel locations, frequency and level of luxury match a $ number from random strangers online. You could find $20-30K/yr to be way too little or way too much once you start travel spending. I would have started with what you’ve actually spent on travel and then extrapolate from there if you plan to travel more or better in retirement. Bon voyage.

 

[skyking1]

That's just it, our travel has been so sporadic as to be not useful for planning. It is one of the big goals of our upcoming retirement.

 

[NW-Bound]

It is easy to stay safe and RV travel in covid times. Go for it NW!! We love it, our own home own bed happy pets.

I'll try. After 2 years of non-RV'ing, I feel some reluctance to climb onto the saddle again. Driving an RV is work, and I am feeling older all the time.

If I don't make another RV trip this year, I may as well sell the motorhome and hang up my spurs.

 

[Marita40]

I budgeted $22,000 for travel for 2022. Single person. Have no idea yet where/how I will use it as hopes of overseas trips keep getting deferred.

 

[anothercog]

I'm not there yet but anticipating/budgeting $40k/year for travel and $35k/year for healthcare (at least until we qualify for Medicare).

Travel will be our main hobby so I expect it will be our most significant expense followed by healthcare.

 

[skyking1]

I'll try. After 2 years of non-RV'ing, I feel some reluctance to climb onto the saddle again. Driving an RV is work, and I am feeling older all the time.

If I don't make another RV trip this year, I may as well sell the motorhome and hang up my spurs.

I do hear that. For now I am OK, I pull a 5th wheel trailer and though it sounds like a lot of trouble, going down the road is quiet and low effort. My friend's V-10 class A motorhome is screaming up the steep hills out here, and I just shift down one gear on my diesel truck and we can converse normally. It is rock steady in the winds too.

 

[Magus]

Really just depends

Cheaper travel budget:
-Plan well ahead
-Stay less expense hotels / fly in coach
-Come up with a number of locations to visit and choose the cheapest one
-Play the credit card point/mile game
-Travel offseason
-Significant research before booking
-Group tours rather than private tours

Expensive travel
The opposite of all the above

And of course everything in between! Given what other folks have said, you can probably somewhat adjust based on how you see yourself doing the above.

 

[foxfirev5]

As you can see the numbers are all over the board. I would suggest modelling travel and healthcare separately for your own situation. For example ACA subsidies and income management may be a factor for your healthcare. If so you would probably want a significant portion of your assets in taxable accounts and not tIRA's. Otherwise there may not be enough for travel.

I could go on and on but you really need to work it out yourself.

 

[ERhoosier]

FIREing in the 50's leaves a huge financial cone of uncertainty over the following (hopefully) 30+ years of life. With your ambitious travel plans I assume your net egg income would mean no Medicaid eligibility.

Several have mentioned looking at the ACA Exchange for health insurance premiums (which increase SIGNIFICANTLY with age BTW), and that means looking at policy specifics. If you plan to travel a lot you should look only at plans with out-of-area coverage (which actually is not even available in some states!), and budget for separate international health insurance while traveling outside the US. In addition, one must also budget for those sizeable deductibles and Out Of Pocket maximums (OOPmax). Almost any hospitalization, or some moderate-to-complex ER visits, and you will likely get hit for that OOPmax. And that does not include charges deemed "not medically necessary" (not a theoretical concern, especially which traveling outside your local area). These points go 150+% for 3 adults.

International travel expenses can jump greatly over one's initial budget with unexpected COVID travel restrictions (like hotel/living expenses if testing positive for COVID and required to quarantine).

 

[COcheesehead]

FIREing in the 50's leaves a huge financial cone of uncertainty over the following (hopefully) 30+ years of life. With your travel plans I assume your net egg income would mean no Medicaid eligibility.

Several have mentioned looking at the ACA Exchange for health insurance premiums (which increase SIGNIFICANTLY with age BTW), and that means looking at policy specifics. If you plan to travel a lot you should look only at plans with out-of-area coverage (which actually is not even available in some states!), and budget for separate international health insurance while traveling outside the US. In addition, one must also budget for those sizeable deductibles and Out Of Pocket maximums (OOPmax). Almost any hospitalization, or some moderate-to-complex ER visits, and you will likely get hit for that OOPmax. And that does not include charges deemed "not medically necessary" (not a theoretical concern, especially which traveling outside your local area). These points go 150+% for 3 adults.

International travel expenses can jump greatly over one's initial budget with unexpected COVID travel restrictions (like hotel/living expenses if testing positive for COVID and required to quarantine).

Emergency, out of area coverage, is almost always provided. International is the exception.

 

[Librarian]

Really just depends

Cheaper travel budget:
-Plan well ahead
-Stay less expense hotels / fly in coach
-Come up with a number of locations to visit and choose the cheapest one
-Play the credit card point/mile game
-Travel offseason
-Significant research before booking
-Group tours rather than private tours

LOL--You nailed it!
We prefer to travel MORE rather than travel luxuriously.
I use every one of these strategies to do just that.
Do we like a nice room? Sure, but we are rarely in it. So only if I can get a tremendous value am I going to get one.

I have been playing the points game for 10 years since our oldest started college visits. It was quite easy to earn SWA Companion pass by putting private college tuition on credit cards (the value more than outweighed the fees to do that)
We thought that we were done w/ Companion pass since private college is done--but a 100K sign up bonus had us jump again. Got the card in mid Dec & have been charging everything possible--Xmas, trips, estimated & house taxes, (public) tuition, daily expenses. We should have it by early Feb.

We have hundreds of thousands of SWA & hotel points (IHG & Hilton) plus generic travel points on Chase/Capital One mostly due to credit card bonuses. DH & I switch off taking advantage of these.

IHG priority is a no brainer--125K points w/ $3K spend in 3 mos.
One annual free night plus free TSA precheck entry fee every 4 years.
We get the $49 regular one as well as you still get a free night.
So those 2 nights average $75/nt.
We even stayed at the Intercontinental Times Square on that free night.

DH retired last year, and I will in May.
We are blessed to have BC/BS thru our pension plan for $1100/mo.

Our upcoming tripstho both parents battling cancer so all is tentative
1--Weeklong cruise on Celebrity Apex. (began sailing summer 2021)
Booked Sept. 2020 for March 2021; moved to 2022.
$2k for balcony, drinks, tips, wifi plus $450 on board credit.
Unfortunately flights were stupid expensive ($650 each; usually about half that) on all airlines
We will likely earn Companion pass by then but didn't know that at the time.
Oh, well, I will have nice credit to go see DD or BFF.

2--12 day Princess UK cruise in Sept.
Have $1200 TAP airline credits to use & this is a bucket list so very excited.
$4K for oceanview, drinks, tips & wifi. Could have done a slightly less expenseive/shorter one & saved $800 but this hit all the places we wanted to go so it was worth it.

3--7 day Caribbean on NCL Encore
DH won this cruise Dec. 2019. We still have to pay taxes, fees & tips plus will likely upgrade to balcony as we have some cruise next certificates to use, but this saves us nearly $3K with the $1K poker tournament entry.

4--14 day Carnival Hawaii cruise
I submitted a casino match with them (we are "diamond" with Caesars--let's just say the points game allows us this w/o the play level) & the offered me a free cruise (interior--again, not in our room). 3-14 days, many itineraries. We had some Carnival credit to use from a 2020 cancelled cruise which I thought we were going to eat. So that covered taxes & fees. Tips are the only essential thing we will have to pay (they will probably be disappointed in my gambling on board but I'll take the one free cruise they offer!)

(Also--10 day Med cruise NCL Breakaway w/ our 3 adult children
With NCL's Casinos at Sea promo we are getting this w/ drinks, 3 speciality meals each wifi & airfare for $2500 each. A tremendous value we felt.)

I get it--some have no interest in playing the game of points or finding the best deals. Some want luxury & are willing to pay for it.
But i ENJOY the points game & squeezing every penny out of every dollar we make. Don't get me wrong--we ENJOY ourselves on vacation. We enjoy our cocktails, and will pay for the things we want to do or see.

We hit Vegas several times over COVID (since travel was limited) & we did 2 weeks on the Celebrity Edge this summer which was AMAZING. We paid "too much" for that--and it was WORTH EVERY PENNY. My mother was diagnosed w/ metatasized lung cancer in Feb & she joined me for the 2nd week so money was no object. (she is still plugging along!)

So my budget for the next year (I'm counting Jan 2022) is about $10K for 4 trips excluding OOP spending $ for each. Guesstimating $6 more for that).
So about $16K for 3 domestic & 1 international trip and they were generally bargains.

 

[Koolau]

Realistically, our travel budget is based on one round trip to mainland (budget $2K total for both of us) plus our year-round rental of the homestead on the mainland - $6K which covers our 3 to 4 month stay. Then, add car travel on the mainland of perhaps $2K for gas/lodging. That puts us at around $10K per year. It's a nice round figure that we don't really worry too much about. Some years are lumpier than others but it probably averages out. YMMV

 

[Librarian]

Some years are lumpier than others but it probably averages out. YMMV

I love that vocabulary: "lumpier"

 

[skyking1]

yes, I will lump all sorts of things under "lumpier" for the first couple of years.

 

[HI Bill]

International costs vary greatly. African safari? Galapagos dive liveaboard? Hotel on the Riviera?

I had a FIRE travel budget of $60K, which for my wife's style of 'budget' traveling, would give us 3-4 months of international travel. You could blow that same $60K on one African safari. Or 4 weeks at the Wakatobi dive resort in Indonesia.

 

[brett]

Pre covid we would typicall do two snowbird months in Thailand/Australia, Mexico, or Panama/Costa Rica. Plus 2 months (Sept/Oct) in Southern Europe.

Also sometimes a last minute AI and more often than not a Christmastime AI in Mexico with daughter and family.

We have been doing this for eight years. All independent travel and a much of it spontaneous.

We no longer book far in advance. We find that more often than no we get better air by booking a month or less in advance. Same with accommodation.
We often enjoy savings this way. Our last winter was spent traveling around Mexico. We scored two last minute 5 day AI stays at very attractive rates. One in Playa, the other in PV.

IF you are flexible and IF you are not tied down to a specific time schedule there are often deals to be had if you shop sites in North America and elsewhere. As an example, our two Mexican AI's were booked through a UK agent. They were 15 and 20 percent less than the best price we could get by booking direct or through a NA TA. We have done the same for last minute cruises.

Once you start traveling, speaking with folks during your travels, and working the web you will find that you can stretch your travel dollars in B7B's through to six star hotels/resorts.

 

[Koolau]

2020 was VERY lumpy. We still had to pay $6K for our housing but never got there (saving the air fare and ground travel.) Covid, doncha know? YMMV

 

[Retired Expat]

Like most of the broad questions asked here the answer is “depends”. What does travel cost? What does a car cost? Which one or why luxury level, new or used, bells and whistles or not. For travel which we do a lot of, are you close to a gateway city? On the east coast? But almost always cheaper if you can fly nonstop to where you want to go. Do you do 1st class’s hotels or AirBnB’s. AurBnB’s can save a lot especially if traveling with another couple but even not as not every meal, drink, snack or coffee Is from a restaurant or the mini bar and if you can do a home exchange cost almost nothing. Or consider pet sitting lots of ways to reduce costs and still travel well

 

[11522914]

Wow, many of you have some nice large travel budgets. Good for you !!!!

We budget 5k per year cash out of pocket. Another 3 - 5k value in cc reward points. In 2020 we spent less than $500 on travel. 2021 we spent about 2k cash and 2k reward points.

Hopefully this year we will spend our full 10k.

Right now we're staying 5 days in a hotel in the Great Smoky Mountains. Total 5 day cost for 3 star hotel is $115, rest was points.

We budget 1k per month for total medical costs including insurance. In 2020 and 2021 we spent less than 1/2 that each year.

All expenses listed above are for 2 people.

 

[Koolau]

^^^^^

I'm sure we could afford to spend much more on travel a lot more, but we're pushing 75. Most of the travel we wanted to do - we have done. Now, travel is primarily to see old friends and new family (grandkids, doncha know). Other than that, we are slowing down. SO, you young'uns (you, know you folks in your 60's) should travel NOW and don't wait. BUT YMMV as always.

 

[brett]

We have done two month snowbird trips for the last nine years.

Two months in Thailand (our favorite winter destination), Vietnam, and Malaysia cost about the same as three-four weeks in any of Florida, Hawaii, or Australia.

Incredibly, our best economy air fare to SE Asia are sometimes the same cost as flying to MIA or FLL.

Last trip, we spent five nights in a Sheraton, Sydney hotel for 0 cost by using Marriott points. The cost would have been $1200-$1800 for a similar hotel in a similar city location. And we used Delta points for our one way flight to Bangkok.

There are many, many wrinkles in shopping for travel products. We cut the cost of oceanside condo in Greece (Zakynthos) by 40 percent simply by dealing direct with the owner and paying cash instead of Booking.com. In some countries, especially Greece, Italy, and Croatia we always ask what the discount is for cash. In some instances it is 10 or 20 percent, sometimes an upgraded room, or we get some other benefit that we would otherwise have to pay for included.