Daily Money - Is Your Homeowners Insurance Enough?

July 2, 2021

We’re heading into hurricane and wildfire season, and both are predicted to be worse than usual this year. It’s a good time to check your homeowners policy to see how much coverage you have in the event of a disaster. If you’re not insured for the full replacement value of your home, you’ll likely face hefty out-of-pocket costs if you need to rebuild — especially considering how the prices of some building materials have skyrocketed. You’d hate to be forced to dip into your retirement savings to make up the difference. I just had a new kitchen installed in my apartment, and I doubt my existing coverage would provide enough to replace everything if it were to get damaged — so I need to look into that pronto. Learn more about homeowners coverage in today’s edition.

Retire with Money will be off next Tuesday for the long Independence Day weekend. Happy 4th, everyone!

Best wishes,

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What are you up to these days?

Where we live, the winters are long, snowy, and brutal, but the summers are glorious, so we are taking advantage! We are spending a lot of time enjoying our deck and yard. We also take a look at the boating weather each morning and decide whether or not to go (Lake Michigan) since we don't have to wait for a crowded weekend day now! We had two weddings and two graduations this summer, so spending time with family has been big. I [Lori] committed to doing "absolutely nothing for six months," to unwind from a stressful career, and so far it is working — my blood pressure is down 20 points!

Fantastic! Any advice you have for others preparing for retirement?

You don't have to rush into doing anything on that first Monday! If you want to get back into part-time or volunteer work at some later time, it will still be there for you. Brian took two years off to assess what he wanted to do, and wound up working part time five years at the Home Depot in his "jobby" — our nickname for a hobby job —  before he retired again. Look for something you WANT to do, not something that you HAVE to do. Get a personal computer, set up a home office, and get organized! We were used to having large company resources so it was quite a switch to become our own IT department. Financially, make sure you spend A LOT of time modeling what your income could be when you retire. Brian spent WEEKS with a spreadsheet, determining what kind of pension, when to take it, and when to take Social Security. We also bought term life insurance to bridge to the youngest kid's college graduation.

Smart! What's your saving and spending philosophy?

LIVE BELOW YOUR MEANS! Always save enough in your 401(k) to get your company match, plus anything else you can possibly squeeze out. We followed old-fashioned rules and had "a number" in mind that we worked toward.

Just like for the dog, occasional treats are ok! There is a very fine line between being cheap and being thrifty. We like fine wine, cigars (him), and travel. We are pretty good planners, and although a new roof last year was a surprise — thank you dead tree in the backyard — we were able to figure it out. We monitor the budget weekly, and fortunately one of us enjoys balancing a checkbook to the penny! One thing we do not scrimp on is our monthly hair appointments — we were introduced by our hair stylist!

Retirement News From Around The Web

How to Disaster-Proof Your Personal Finances
Having these estate planning documents in place can help you and your loved ones navigate a crisis. CNBC

Inflation and You: 8 Tips for Your Finances
There’s no reason to panic about rising inflation, and every reason to be prepared. NEXT AVENUE

How to Determine When an Older Adult Requires Caregiving Assistance
Here’s a detailed description of what to assess, down to the treads on your loved one’s shoes.  AARP

Plastic Surgery Is Increasingly Popular, but the Stigma Remains
People love how they look after their procedures, a survey finds, but many are still reluctant to admit they had work done. INSTYLE

Elizabeth O'Brien is deputy editor at Money. She has covered retirement and health care for nearly a decade. A Brooklyn resident and mom of two boys, she navigates the alphabet soup of Medicare and the New York City subway system with equal ease. You can email her at elizabeth.obrien@money.com and follow her on Twitter at @elizobrien.

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