Money in, money out · Module 5 of 10
The costs retirement doesn't warn you about
The retirement costs people forget: relying on one income, what a partner is left with, and health costs that rise later.
Key terms in The costs retirement doesn't warn you about
- Defined benefit plan
A defined benefit plan, commonly called a traditional pension, is a retirement plan that promises a specified benefit based on a fixed formula. The formula usually weighs salary and years of service. The employer, not the worker, bears the investment responsibility, and benefits are typically paid as a lifetime annuity.
- Annuity
An annuity is a series of payments made at regular intervals under a contract, over a period of more than one year. In retirement, insurers and pension plans use annuities to turn a balance or a promise into ongoing income. Some annuities continue to a surviving spouse after the first recipient dies.
Source: Internal Revenue Service, Retirement plans definitions
- Long-term care
Long-term care is a range of services that help people with daily activities when illness, disability, or a cognitive condition keeps them from managing alone. It differs from medical treatment because it supports living as before rather than curing a problem. It can be delivered at home, in assisted living, or in a nursing facility.
Source: National Association of Insurance Commissioners, Consumer Long-term Care
Every term on Lever is in the money glossary.
About this module
The costs retirement doesn't warn you about is part of Money in, money out, one of 15 subjects in Lever. It’s a short run of 5 lessons, about 13 minutes in all, so you can finish it in one sitting.
Every lesson takes one idea at a time. You read it with the math worked out step by step, answer a question that puts it to use, then see why the right answer is right and why the others aren’t.
It’s for anyone who was never taught this, and you don’t need to know anything first. Every lesson is free. Lever works out what you already know, so you can start here or let your path bring you to it.
More in Money in, money out
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1
What lands in your account
Read your payslip line by line and see where the gap between your salary and your paycheck goes.
5 lessons -
2
Your floor and your slack
Work out the least you need each month, the wiggle room above it, and what to do in a tight month.
13 lessons -
3
The size of a life after work
How much of your income to keep for later in life, and why your working years are the easiest time to build it.
5 lessons -
4
The pension that's already being built for you
What the pension deductions on your payslip are buying you, and what changes if you claim early or keep working.
5 lessons -
6
When there is no wage
Managing money without a regular paycheck: cash income, gig work, months with nothing coming in, and making savings last.
7 lessons -
7
When the plan stops matching the month
What to do when your budget stops matching real life, including when it’s the budget that needs to change.
6 lessons -
8
Tracking without obsessing
A simple tracking habit you’ll keep, a quick monthly review, and how to stop a raise from quietly disappearing.
6 lessons -
9
Everything you own, minus everything you owe
Your net worth: everything you own minus everything you owe, and why watching it over the years tells you so much.
6 lessons -
10
When the money itself shrinks
How to protect your money when prices rise fast: what to buy ahead, and what inflation does to your debts and your pay.
5 lessons
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