For many retirees, travel represents freedom — the opportunity to explore, reconnect, and enjoy experiences once postponed by work and family obligations. Whether it’s extended international travel or shorter trips closer to home, travel often plays a meaningful role in retirement lifestyle planning.

The key to traveling confidently in retirement is not spontaneity alone, but intentional financial planning. With the right strategy, travel expenses can be funded sustainably without jeopardizing long-term financial security.

Define What Travel Looks Like in Your Retirement Plan

Retirement travel goals vary significantly. Some retirees prioritize frequent international trips, while others prefer occasional domestic travel or seasonal getaways.

Key factors to define early include:

• Frequency and duration of travel
• Domestic versus international destinations
• Travel style and spending preferences
• Health, mobility, and insurance considerations

Why it matters:
Clear travel goals help determine how much retirement income must be allocated toward discretionary spending and how travel fits into your overall financial plan.

Build Travel Expenses Into Your Retirement Income Strategy

Travel should be treated as a planned retirement expense, not an unstructured add-on.

Common sources used to fund retirement travel include:

• Investment portfolio income (dividends and interest)
• Systematic withdrawals from retirement accounts
• Pension and Social Security income supplemented by savings

Many retirees spend more on travel during the early “go-go” years of retirement, when health and energy levels are higher.

Planning insight:
Front-loading travel spending can be appropriate when supported by a disciplined retirement income and withdrawal strategy.

Use a Bucket Strategy to Fund Travel

A bucket strategy can help separate essential living expenses from discretionary goals like travel.

• Short-term bucket: Cash and short-duration investments earmarked for upcoming travel
• Intermediate bucket: Income-producing assets for discretionary spending
• Long-term bucket: Growth investments designed to support later retirement years

Why it works:
This approach helps protect long-term assets from short-term market volatility while ensuring travel funds are readily available.

Maximize After-Tax Cash Flow for Retirement Travel

Taxes play a critical role in determining how much income is available for travel in retirement.

Tax-efficient strategies may include:

• Coordinating withdrawals across taxable, tax-deferred, and tax-free accounts
• Managing required minimum distributions strategically
• Using Roth accounts to fund higher-spending travel years

Planning insight:
Improving tax efficiency can significantly increase travel flexibility without increasing portfolio risk.

Plan for Healthcare and Insurance While Traveling

Healthcare considerations are especially important for retirees who plan to travel frequently or internationally.

Important considerations include:

• Medicare coverage limitations outside the United States
• Supplemental or international travel medical insurance
• Emergency medical planning while abroad

Why it matters:
Unplanned healthcare costs can disrupt a retirement travel budget if not addressed proactively.

Adjust Travel Spending as Retirement Evolves

Travel preferences and capabilities often change over time. Many retirees naturally reduce travel later in retirement and reallocate spending toward other priorities.

Regular reviews allow retirees to:

• Adjust travel budgets as health or preferences change
• Rebalance portfolios to support evolving cash flow needs
• Maintain long-term retirement sustainability

Planning insight:
Flexibility is essential. Retirement travel planning should evolve alongside your financial plan.

Funding Travel in Retirement: The Bottom Line

Travel can be one of the most rewarding aspects of retirement, but enjoying it with confidence requires thoughtful planning. By defining goals, incorporating travel into a retirement income strategy, managing taxes, and maintaining flexibility, retirees can travel without compromising long-term financial security.

With a well-structured plan, retirement travel becomes sustainable — allowing you to focus on experiences rather than financial uncertainty.

If you would like help integrating travel goals into your retirement income plan, working with a trusted financial advisor can help ensure your strategy supports both today’s adventures and tomorrow’s security.

Any opinions are those of Forman Investment Services and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional. Investing involves risk and you may incur a profit or loss regardless of strategy selected, including diversification and asset allocation. Prior to making an investment decision, please consult with your financial advisor about your individual situation.

This content was created with the assistance of artificial intelligence (AI). While efforts have been made to ensure the quality and reliability of the content, it is important to note that AI-generated content may not always reflect the most current developments or nuanced human perspectives. CSP#995601