6 Things Gen Xers Should Purchase Before Retiring
Written by
Angela Mae
Edited by
Jenna Klaverweiden
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It’s no secret that incomes tend to drop during retirement. According to the U.S. Bureau of Labor Statistics, people 65 or older had a median income of $50,290 in 2023. By contrast, the real median household income was around $75,000.
For those born between 1965 and 1980 (Gen X), there’s still plenty of time left before retirement. That means now’s a good time to take advantage of potentially higher incomes than they’re likely to have once they leave the workforce behind.
With that in mind, here’s what the experts think Gen Xers should buy before they retire.
Healthcare Insurance
If you’re a Gen Xer and haven’t done so already, consider buying a comprehensive health insurance policy.
“Health insurance coverage shields the insured from unplanned medical expenditures and ensures access to care that could otherwise adversely impact your finances,” said Joe Cronin, president of International Citizens Insurance.
According to the KFF, for 2024, the average annual health insurance premiums in the U.S. are $8,951 for single coverage and $25,572 for family coverage. Since most people don’t qualify for Medicare until they turn 65, having a comprehensive plan could be a smart move in the interim.
Long-Term Care Insurance
Long-term care insurance is another must-have for your future protection and peace of mind.
“Long-term care insurance is essential for covering long-term care services,” Cronin said. “It also helps safeguard your retirement funds from the high out-of-pocket costs associated with aging.”
The average annual premium for a $165,000 long-term care insurance policy is $2,080 for a 55-year-old couple, as per a 2024 American Association for Long-Term Care Insurance survey.
By contrast, the average cost of long-term care ranged from $35,000 to $105,000 in 2021, per RetireGuide.
Home and Property Improvements
According to Melissa Murphy Pavone, CFP, CDFA, founder of Mindful Financial Partners, home and property improvements are another must-buy before retiring.
According to HomeGuide, the average annual maintenance cost for a home can range between $4,000 and $22,000, but that can vary based on the home’s age, condition and more.
Considering the median age of all owned homes is just over 40 years old, per the latest American Community Survey, chances are that Gen Xers will have an “older” home upon retirement. So it’s best to make any property improvements — large or small — while incomes are still higher.
It’s also a good idea to have a separate fund for home repairs, improvements and emergencies. Even if that money’s never used, having it never hurts.
Solar Panels
If you’re interested in having a more energy-efficient home, Cronin suggested installing solar panels. This one’s best for those who have enough time to make their money back from the purchase.
According to Forbes, the cost of installing solar panels ranges from $8,500 to $30,500, though the average is closer to $13,000. That’s a hefty sum for those living on a fixed retirement income. However, the return on investment for solar panels is about 10%, per Forbes.
“Purchasing [solar panels] for your home will not only help you cut down monthly utility costs; it can also increase the value of the property,” Cronin said. “The long-term savings and positive environmental impact of switching to these sustainable energy sources definitely make up for upfront costs.”
Comprehensive Financial Plan
While not everyone needs a comprehensive financial plan, spending some time — and money — to create one could be worth it in some cases, like if you have a complicated portfolio or will.
“In retirement, the sequence of withdrawals — from taxable, tax-deferred and tax-free accounts — can have a big impact on your tax situation,” Murphy Pavone said. “A comprehensive plan can help determine the most tax-efficient way to access funds, potentially keeping you in a lower tax bracket, which can also reduce how much of your Social Security benefits are taxed.”
Travel
Have you ever dreamt of traveling? If so, there’s no better time to take those trips than now. Not only is your income probably higher than it will be once you’ve retired, but there’s a lower risk of health or mobility issues that might prevent future trips from happening.
“The return on investment in travel experiences includes a life enriched by adventure and discovery, so these should be embraced with both hands,” Cronin said. The experiences and memories gained through travel can also lead to a more fulfilled life — and potentially happier retirement.
And if you’d prefer to wait to travel until you’ve retired, an alternative would be to start setting aside a separate fund for future trips. That way, the money’s available when needed and there won’t be as much of a financial strain on other retirement funds.
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