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Sometimes when I check my mailbox I am pleasantly surprised by someone who is offering to write a post for my website.
Although I am about 5 years away from becoming an “empty nester,” when Nelly offered a blueprint of how to prepare for this eventual transitional period I absolutely jumped at the opportunity to have it on my platform.
So without further ado, I present Good Nelly [We have no financial relationship]:
“People make a lot of jokes about the empty nest. Let me tell you, it is no laughing matter. It is really hard” – Michelle Pfeiffer
Parents left with an empty house usually face the psychological dilemma of letting their kids go to the outside world.
While their kids were home, their life probably revolved around the kids, which is very common.
When the kids move out from their “Nest”, the loneliness of the parents can be overwhelming.
This situation can be very hectic for the parents to deal with.
It’s not only emotionally devastating, but it can also generate financial disturbance.
You might also be getting confused due to this situation thinking are you getting a financial freedom or going towards financial difficulties?
Dianne Charman, one of the senior financial advisers at Jade Financial, explained what to do – “It is time to think about you.”
If your kids have just moved out from your so-called “Nest”, congratulations!
You are now officially an “Empty Nester”.
Now, it’s time for you to relax and focus on yourself again.
It’s the best time to re-plan your finances and priorities so that you get the most out of your next phase of life.
You might be thinking about how to do that.
Well, I have put together a checklist that will help you to manage your finances and get prepared as soon as possible.
“Adolescence is perhaps nature’s way of preparing parents to welcome the empty nest” – Karen Savage
Here is the ultimate financial checklist that you need to follow:
1. Picture your retirement savings
Studies have shown that every successful retiree made plans for retirement ahead of time and started with a vision.
So, you must also visualize how to stack up your retirement savings.
It is better if you consult a financial adviser asap.
The amount you need to save for retirement depends on few factors like your desired lifestyle in retirement, your future financial growth rate, your current retirement assets, and inflation.
You must also consider the sources of retirement income like Social Security, pension, income from business, rental, etc.
Once you identify these factors, review the numbers with your financial expert and determine the amount to be saved for your retirement.
This way you can reach your goals without any hassle.
2. Track and evaluate your spending
Being an empty nester, you must track your expenses and plan a new monthly budget.
Your kids are now gone, so you may limit your spending on things that you don’t require or need a little.
You can’t estimate how much money you’ll require for your retirement without analyzing your expenses regularly.
Start tracking your expenses from now on and compare your expenses with your income.
This will help you to adjust your savings if required.
3. Prepare a budget
Prepare a budget for the coming 10 years of your life.
For that, you need to consider few essential costs like health insurance, the maintenance cost of your home, and many more.
Once you calculate the total expenses, think about your savings amount and adjust your retirement contributions accordingly.
“If the nest is truly empty, who owns all this junk?” – Erma Bombeck
4. Downsize your home
As your kids leave your nest, you may consider downsizing your home.
You can move into a small house to save money on your mortgage and power bill.
You may consider moving into a small apartment.
It will save money on property taxes, maintenance costs, and landscaping expenses.
Consider downsizing starting from [inside] your home.
Sell out or get rid of the unused stuff.
The more stuff you remove from your house, the more time and effort you’ll save while moving to a new home.
5. Rent out your rooms
If you want to pass on the last option and decide to continue living in the same house, you may use those empty rooms to earn money.
Clean up your empty rooms and get some renters for your home.
Add listings on Trulia or Zillow for long-term rentals.
You may look out for business travelers if you intend to rent out the home for a short time period.
6. Update your grocery list
Yes, it is time to update your grocery list as per your requirement.
Now you have only a couple of mouths to feed so your food cost should be lower than what it would be like if your kids are in the same house.
You don’t have to make meals as much, so you’ll save money on groceries more than before.
Avoid eating out at big restaurants.
Try to prepare meals at home with a lower budget.
7. Reconsider your ride requirements
Your kids have moved out; now it’s time to reconsider your ride type.
You probably don’t need a car that is as big as a Family tour bus.
So, why don’t you downsize into a smaller, more convenient, and economical car?
If you have more than one car, you may sell one vehicle and put that money into your retirement fund.
If you still want to keep the second car with you, make it useful.
Rent that car to earn extra money.
“You call it ‘Empty Nest,’ I call it ‘New Craft Studio’” – Anonymous
8. Focus to your hobbies
People usually ignore their hobbies due to their parental duties.
Now that you’ve got plenty of “me time”, spend enough time to pursue your favorite pastimes.
It could be anything!
If you cook well, give time to experiment on a few new dishes.
If you have a talent for singing or dancing, join the school and polish your skills.
Do whatever you like, be creative.
You can also get success in your life by developing one of your hobbies.
Just make sure to do some constructive thing where you can invest money and time, and in return, you can earn a good amount with work satisfaction.
9. Review your insurance policies
Being an empty nester, you must review your insurance policies.
It may include:
- a. Life insurance
- b. Long-term care insurance
- c. Disability income insurance
You can contact a reputed insurance agent and get help to compare different insurance policies.
You must also consider how each policy may impact your financial future.
If you want to qualify for Medicare and get all the free preventive health exams, you need to apply for it within the age of 64.
At your empty nest stage, usually, your income level would be maximum to date.
To secure that income flow, a disability insurance might be most helpful.
By using that fund, you will be able to manage your debts and other expenses, too.
Contact an agent and get details about getting a disability income insurance as soon as possible.
10. Finally, prepare a good estate plan
Give some time to set up your estate plan.
As per the National Institute on Aging, you must consider a will.
You might also need a power of attorney to manage your assets and a health care directive.
For a small estate, a simple will might be enough.
But if the number is bigger, it may be important to discuss the matter with an estate lawyer.
Next, collect all the important financial records, asset titles, and beneficiary names.
Call a family meeting and explain what you are giving to them and how to proceed if anything unexpected happens.
Your journey from an active parent to an empty nester might be difficult.
But if you work smartly and follow these unique moves, I am sure your journey will be a joyous one.
Let your future be filled with new challenges and excitements.
Best of luck.
Author Bio: Good Nelly analyzes financial happenings and writes articles to aware and help her readers plan for their financial future. She has been associated with Debt Consolidation Care for a long time. However, she has contributed her articles to other websites, too.
NOTE: The website XRAYVSN contains affiliate links and thus receives compensation whenever a purchase through these links is made (at no further cost to you). As an Amazon Associate I earn from qualifying purchases. Although these proceeds help keep this site going they do not have any bearing on the reviews of any products I endorse which are from my own honest experiences. Thank you- XRAYVSN