How to Travel the World After You Retire

Start your retirement travel planning 5 to 10 years before you retire. Just like other aspects of your financial plan, your retirement adventures should be carefully considered. Ideally, at this stage, you should have a substantial savings account, an employer-matched retirement fund, and a solid financial strategy for your post-retirement life.

It’s essential to have a clear picture of your financial situation and how it aligns with your retirement goals. According to 2019 data from the Federal Reserve, the average person aged 65 to 69 has approximately $426,070 in retirement savings.1 However, when you factor in expenses like a mortgage, utilities, and other bills, this sum might not stretch as far as you’d like for an extended retirement. That’s why financial therapist Erika Wasserman recommends creating a separate fund for retirement travel, along with a budget that allows you to achieve your travel dreams.

Wasserman advises, “First, determine how you want to retire. For instance, decide how many trips you’d like to take each year. Then, establish a realistic budget to support that retirement lifestyle.”

How to Make Your Money Last Through Retirement

Create an annual travel budget and leave room for indulgence. It’s not enough to have a 10-year plan; you should also regularly revisit and reassess your financial situation, according to wealth manager Michelle Mackin. If you’re comfortable managing your finances independently, it’s important to understand the total cost of your trips, accounting for potential unforeseen expenses that can arise during travel. Consulting with a financial advisor can help optimize your savings and ensure your financial security for many years, if not decades, to come.

However, retirement is also about enjoying the finer things in life. After years of hard work, it’s time to savor some of the pleasures that retirement can offer. “Even with sound financial planning, no trip is complete without the occasional indulgence,” says Mackin. Allow some flexibility in your budget to accommodate unplanned shopping sprees, last-minute excursions, or the desire to dine at a Michelin-starred restaurant on your final night of vacation.

Create a wanderlist

Your financial resources will fund your flights, accommodations, and dining experiences, but it’s your quest for adventure that will fuel your travel experiences. While the dream of visiting every country in the world is enticing, as you grow older, you may find that your energy and mobility decline, making certain adventures less practical. This is why it’s crucial to narrow down your travel desires into a “wanderlist,” as recommended by Virtuoso travel advisor Sandy Pappas. Once you’ve identified the destinations and experiences you’re passionate about, you can start planning your travels based on your age and physical capabilities. For instance, you might not want to embark on a lengthy flight when you’re 80, but it might be perfectly fine at 67.

Pappas elaborates, “I work with my clients to prioritize these bucket list trips. For instance, if they have their hearts set on visiting Africa, Australia, or New Zealand, I suggest that they undertake these trips sooner rather than later due to the long-haul flights involved. Extended flights can be more demanding on individuals, so I recommend they tackle them in the earlier stages of their retirement. Australia is a vast country with flights between destinations, so it’s a more active trip.”

Don’t overlook insurance

Both travel insurance and international health insurance are essential investments for older travelers. However, it’s crucial to understand that these policies don’t cover every scenario. For example, if you’re hiking in the Swiss Alps or on a walking tour in Santorini, Greece, and you have a fall resulting in a hip fracture, Pappas explains that a traditional insurance policy will provide medical evacuation to the nearest hospital in your destination. But if you prefer to be flown back to the United States for rehabilitation, you must have coverage for medical evacuation to your preferred hospital.

Reading the policy details carefully and seeking recommendations from friends who have experience with trusted policies is essential. You don’t want to find yourself in an expensive and complicated situation abroad, further complicated by language barriers, which could also blow your travel budget for the year, according to Pappas.

Opt for home rentals over hotel rooms

In your younger days, you might have been content with staying in hostels or sleeping on the floor while exploring Europe. However, in retirement, you’ll likely desire a bit more comfort and convenience. Moreover, you may want to maintain your daily routines, whether you’re at home or traveling. Wealth manager Michelle Mackin suggests that renting a home is a cost-effective and comfortable way to travel during retirement. This allows you to take a slower pace and enjoy longer stays, as many vacation rental companies, such as Airbnb, offer monthly discounts for extended bookings. This approach enables you to savor all the delights of beach destinations like Mexico, with accommodations that don’t require climbing stairs, offer refreshing air conditioning, and are stocked with kitchen essentials for preparing your favorite meals. Renting homes is becoming increasingly popular among travelers aged 60 and older, and in 2018, Airbnb reported that this demographic was their fastest-growing group of users.