Many seniors struggle to get by on a fixed income -- even those who save responsibly during their working years. Part of the problem stems from the fact that many underestimate how much retirement will actually cost.

Now, when we think about the major expenses retirees tend to face, we're usually quick to identify housing, healthcare, and leisure (keeping in mind that seniors have a lot of free time on their hands, and need to fill it somehow). But here's one expense that might cost you more than anticipated in retirement: transportation.

Transportation is the second largest expense for Americans 65 and over, according to the Bureau of Labor Statistics, and it costs the average senior $6,814 a year. Much of that relates to the cost of vehicle ownership. Maintenance, repairs, and insurance can add up over the course of a year, regardless of how often a vehicle is actually used.

Older man in driver seat of car

Image source: Getty Images.

And that leads to another point: Many people assume that their transportation costs will go down in retirement, since they'll no longer have to commute to a job. But unless you're living in a walkable city (and you have the physical capacity to walk long distances, which not all seniors do), you'll still need a means of getting from place to place.

Furthermore, driving remains seniors' primary choice of transportation. Not only is it convenient, but for retirees without access to public transportation, it's the only option. And make no mistake about it: Almost 70% of Americans 50 and older live in suburban or rural areas where public transportation is minimal or nonexistent.

If you're close to entering retirement, or are planning for it, be sure to account for what transportation might really cost you. At the same time, consider taking steps to reduce that expense to free up much of your limited income.

Lowering your transportation costs

One of the easiest ways to keep your transportation costs manageable in retirement is to avoid owning a vehicle unless it's an absolute necessity. It costs $8,849 a year, on average, to own a vehicle, according to the American Automobile Association, so if you're able to live somewhere with public transportation, you'll save a bunch of money by avoiding that single expense. Keep in mind that seniors often get a discount on public trains and buses, making them even more affordable. If you do need access to a vehicle, consider a compact car, as it could shave roughly $2,100 off your annual ownership expenses.

Moving to a city with walkable access to stores, restaurants, activities, and healthcare facilities is an equally good bet if you're looking to keep your transportation costs down. Not only is walking free, but it might help improve your health, thereby keeping your medical bills to a minimum.

That said, even if you move to a walkable part of the country, you'll need to spend something on transportation. There will inevitably be days when it's too hot or too cold to walk, or when the distance is too far. The best thing you can do, therefore, is be realistic about what transportation will cost you as a senior, and budget for it accordingly. The fewer financial surprises you're hit with in retirement, the more you'll manage to enjoy it without stress.

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