MarketWatch’s personal finance editor Amy Hoak shares how future retirees can better prepare for unexpected expenses including home repairs (such as roof or major appliance replacements) and dental expenses (as Medicare does not cover dental work) by budgeting ahead of time.

Hoak suggests sufficiently padding an emergency fund by setting aside a certain percentage of a home’s value annually. Another approach is to determine the “life expectancy” of the home’s various components, then list and perform an audit for any possible upcoming repairs and replacements.

“One thing I’ve noticed with people getting close to retirement: They tend to put a lot of money into their homes a year or two beforehand, like squirrels getting ready for winter,” she said in an email interview. “It gives them a sense of relief, like ‘OK, everything is done on the house. Now I can retire.’ There is nothing wrong with that at all, in fact I think it’s a good thing. But you have to keep in mind that home maintenance will still be needed over the next 20-plus years,” said Cindy Richey, a financial planner at Prosperity Planning Inc. in Kansas City, Mo.

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