These are the two biggest retirement expenses. Start planning for them now.

Do we really know how much we need before we can retire? When will we use the money? How should we invest?

Retirement needs and spending tend to be a big black hole in many cases.

Lost in the investment details, preretirees forget about managing the expense side of the equation. There are two definite known expenses for every retiree, and they are the largest: Housing and medical.

You can start planning now for these two large expenses by following the tips below:

Housing costs

Housing expenditures increased 7.4% in 2022, according to the Bureau of Labor Statistics. Whether you rent or own, you do not need to see the studies to notice your housing costs have jumped. There are ways to keep this cost under your control and get some peace of mind in the process.

Read: ‘We don’t have enough homes to meet our aging needs’: The ideal home for aging in place might not even exist

1. Regular maintenance and upkeep

If you own, keep your home in good shape throughout the years. Regular maintenance and upkeep not only make a better place to live, but also keep the value in your home. Whether or not you are staying put in retirement, a home in good condition sells faster, is easier to live in and costs less in your retirement years.

If your house needs a paint job, plan for it and get it done. Those new windows you have been putting plastic over to keep the cold out? Perhaps it is time to install new ones. Even minor upkeep like gardening and a fresh coat of paint in a room has an added bonus: You get to enjoy it now while improving your home value.

Read: Aging in place can be cost-effective, but requires good financial planning

One note of caution: Do not update the kitchen or make other large improvements because you intend to sell and want to make more money. Large outlays do not guarantee a full return. By some estimates, only half of kitchen improvements can be recouped in a sale. Only make such updates if you have the money and intend to enjoy it for many years before you sell.

2. Pay down (or off) your mortgage

When your home is fully paid off, the asset is totally under your control. Though you can manage your investments, the direction of the stock market is in other hands. Paying your home off faster gives you options in retirement.

When I suggested this approach to one client, they balked at “wasting the money” paying down their mortgage, when they could be investing. Yes, the market may make you more money, but you could also lose money.

There is an assumption to use “someone else’s’ money” to pay for your home and its improvements. Seldom do they look at the next layer to understand they are paying for that privilege to use someone else’s money. The interest the mortgage company or bank makes from you is a fair business exchange. However, for most of us, mortgage interest is no longer tax deductible, eroding the financial benefit on our end.

Owning a home outright is most valuable for peace of mind. Try it and see how different it feels.

3. Assess the space for future use

If your goal is to stay in your home during your retirement, start to think critically now. Will living on one floor be an option for you? Or can you add a stair elevator when the time comes or extra hand railings now? When you make bathroom updates, add grab bars and comfort height toilets. You may be in super health now and intend to stay that way, but small updates make a big difference if you want to age in place.

Making those minor upgrades makes a huge difference to quality of life. Doing it now while you have an income means less spending in retirement and being better prepared instead of waiting and needing a quick fix or an expensive move.

There are even aging-in-place specialists whose job it is to assess your space and make suggestions as necessary.

4. Consider other locations that may work for you

If you would like to move when retirement comes or be a “snowbird,” start exploring locations now. You do not need to move or buy property. A visit to a friend for a few days or a vacation in a location you are considering will give you a bit of an opportunity to see if the area fits your lifestyle.

Even if you are thinking about downsizing and staying local, you need to understand the type of properties that are available in your area. Today’s options are expansive. From regular condominium units to over 55 living communities or lifecare communities, recognizing which one fits you can be overwhelming. Dabbling now by visiting or stopping by a sales office is a good investment of your time.

Thinking now how each choice affects your pocketbook, lifestyle and retirement goals will make it easier when the time comes to make any choices.

Medical expenses

Medical conditions as a result of aging are inevitable. They range from minor to life changing. Some may be conditions we are genetically disposed to, but even those we can make better by staying on top of our health.

1. Manage your medical conditions

We cannot change it, but we can be attentive to our diseases and potential. Do not wait until retirement to concentrate on what is going on in your body. Starting to get cataracts? Wear sunglasses more to help. Prediabetic? Manage your sugar intake. Get regular checkups while you are working to stay healthy.

Read: The best diets of 2024 have 4 things in common

2. Exercise regularly

This important phrase is repeated so often we may have tuned it out. However, have you ever considered it a part of your retirement plan? If you want to stay active in retirement, you need to do it now. Exercise for your mental and physical health. Whether it is a walk after dinner or a membership to a cross-fit gym (that you go to!), every physical activity will lead to a healthy and happier retirement.

3. Eat right for your health

This sounds good but what is eating right for your health? If you have never met with a nutritionist or learned about good eating, this may be the time. Though you cannot stop every disease with food, you can feel better. There are significant benefits to eating right. Learn about the Mediterranean diet, which may help you live longer.

Read: 10 ways to help protect yourself from dementia, according to science

Do not think you can make lifestyle changes? Here are some examples of lifestyle changes impacting future retirement for the better:

At 60, Mario took up long distance running to manage his health conditions. He lost weight, feels great and stayed off medication.

At 50, Maryann finally gave up smoking and now is walking most days.

Jose, 45, gave up his Friday night drinking with the boys and now is off alcohol all together because he feels better and lost weight.

These folks all have one thing in common: attentiveness to their bodies which has benefited their health. You can teach an old dog new tricks.

Create the most flexibility literally and figuratively now to make for the best retirement possible. We cannot control most things in life. We know that there are no guarantees. We can keep in our hands what we can control as far as our future expenses in retirement. As a result, you will be positioning yourself better in retirement.

CD Moriarty, CFP, is a Vermont-based financial speaker, writer and coach. She can be found at MoneyPeace.com.