In life, accidents happen. But when they occur during retirement, it’s important to be prepared—otherwise, you risk running out of money during what should be considered your golden years.

According to a recent T. Rowe Price survey of more than 7,000 retirees globally, more than a quarter (27%) of respondents said they’d be able to withstand a financial shock in retirement.

Investopedia spoke with financial planners who shared what they think are the most common financial shocks retirees face and how people can prepare for them.

“Retirement resilience isn’t about predicting every expense. It’s about having a safety margin with options and a plan that can adapt when life doesn’t follow the script,” said Mike Casey, a certified financial planner (CFP) and founder of AE Advisors.

Health Care and Long-Term Care Expenses

Most people qualify for Medicare starting at age 65; however, there are many costs the federal insurance program doesn’t cover. For this reason, people may purchase a supplemental plan—an additional insurance policy that can be used to cover costs that Medicare does not pay for.

However, even with a supplemental plan, some retirees can find themselves on the hook for pricey medical bills.

What This Means For You

Unexpected costs can hit hard in retirement, so it helps to draft a plan before retirement, closely review your insurance coverage, and keep a cash cushion on hand so you’re not forced to sell investments in a down market.

“Health care is one of the most common financial shocks. Not catastrophic illness, but the in-between costs people don’t plan for,” said Melissa Caro, a CFP and founder of My Retirement Network. “Medicare and supplemental insurance leave gaps, and many people don’t realize how quickly those gaps add up until they’re already in the middle of it.”

Additionally, neither Medicare nor supplemental plans cover long-term care costs, so financial planners like Casey suggest that people carefully evaluate their potential medical needs before retirement.

“There’s a behavioral element when thinking about health decline, longevity, or family emergencies that’s uncomfortable, so those risks get deferred or ignored,” said Casey. “Reviewing insurance coverage including supplemental, long-term care alternatives, and umbrella liability is critical.”

Housing Costs

Whether you plan to age in place or downsize, housing-related expenditures—like monthly home insurance premiums or the repair of a leaky roof—can eat away at your retirement income.

“Many retirees assume they can ‘just downsize’ if needed, without fully accounting for the cost and timing involved,” said Caro. “Selling a home takes time. It often requires repairs, staging, moving costs, temporary housing, and higher-than-expected prices in the new location.”

Caro notes that this can be especially detrimental for retirees during market downturns, as they may have to sell more of their assets to cover costs.

One way to mitigate the risk of having to sell stocks during a bear market is to keep a cushion of cash savings that you can draw upon instead of your investments.

“The most effective preparation starts with building flexibility into a retirement plan,” Casey said. “That means maintaining a dedicated liquidity reserve beyond basic emergency savings, ideally covering 12–24 months of spending.”