Retiring in Venice, CA – 4 Hidden Risks to Plan For (2025 Guide)
- Gustaf Rounick, CFP®, ChFC®
- Jul 2
- 10 min read
Updated: Jul 21
Venice, CA (90291) – Morning fog lifts over the Venice Boardwalk as retirees sip lattes on Abbot Kinney, but four quiet threats can upend that postcard scene. Before you hang up your work shoes for good, learn how to retire sooner instead.
Local Snapshot: Venice Retirement by the Numbers
• Median home price: $1,964,180 in 2025 Zillow
• Average Medicare Advantage premium (Los Angeles County, 2025): $3.93 per month Medicare Advantage
• Effective property-tax rate: about 0.6% of assessed value, or roughly $12,000 per year on a $2 million Venice home Property Tax 101
• Private nursing-home room: $160,000 per year (L.A. County average)
• Average life expectancy in California: 82.1 years—three years longer than the U.S. average
Why it matters: Your retirement budget must stretch further in a beach community where housing, medical care, and everyday living cost more than the national norm. Use these figures as checkpoints when stress-testing your plan.
Healthcare Costs Keep Climbing Faster Than Inflation
Venice retirees enjoy postcard sunsets, yet medical bills are rising even faster than the tide. A private nursing-home room in the Los Angeles metro now averages $450 per day—about $164,250 a year. Traditional Medicare covers just 100 days of skilled nursing after a qualifying hospital stay and zero routine dental, vision, or long-term care. Factor in Medigap premiums, Part D drug costs, and the 20% coinsurance on outpatient services, and a healthy couple can still spend $400k out of pocket during a 30-year retirement. Build a dedicated healthcare reserve, review Medigap or Medicare Advantage plans each open enrollment period, and reprice prescription plans annually. A good rule of thumb: earmark 15%–20% of your overall budget for medical expenses, then increase that bucket by at least 5% per year to keep up with Westside inflation.
Misconception: Medicare covers everything.
Reality: It leaves gaps—no routine dental, vision, hearing, and no long-term care after 100 days.
Action step: Review Medigap or Medicare Advantage yearly and keep 15%–20% of your budget for medical costs.
We’re lucky to have world-class medical facilities in California, but the cost of healthcare has been rising much faster than general inflation. In fact, prices for hospital services and nursing care jumped about 88% from 2009 to 2024, roughly double the overall inflation rate (latimes.com). What does that mean for you? It means the money you set aside for medical expenses might not go as far as you think.
Even with Medicare at 65, retirees face significant out-of-pocket expenses. A recent estimate found that a 65-year-old couple retiring today needs around $315,000 to cover healthcare costs throughout retirement (that’s after Medicare, for premiums, co-pays, and things Medicare doesn’t fully cover) (napa-net.org). Many folks are shocked by this number – it’s easy to underestimate how quickly prescription costs, doctor visits, and medical premiums add up. And here in Venice, with our higher cost of living, everything from a routine check-up to a specialist visit can lean toward the pricier side.
Local Insight: Venice residents often choose UCLA Health’s Santa Monica campus or Cedars-Sinai for specialty care—excellent facilities, but among the costliest on the West Coast. A single outpatient MRI at these hospitals can top $1,200 before insurance, and Medicare’s Part B 20% coinsurance leaves you on the hook for $240. Add a supplemental plan that waives coinsurance, and budget room for rising Part B premiums (projected at $195/month in 2026). In short, world-class care is close by, but it isn’t cheap—plan for it.
Longevity Risk — Living Longer Than Your Money
Misconception: I will not live that long.
Reality: One in four 65-year-olds will live past 90.
Action step: Plan spending to at least age 95 and delay Social Security for a larger check
Here in California, with our health-conscious and active lifestyles, many of us will live longer than the national average. That’s a blessing, but it poses a financial challenge: your money needs to last longer. It’s not uncommon now for people to live 20, 30, even 35+ years in retirement. According to the Social Security Administration, about one in four 65-year-olds today will live past age 90, and one in ten will live past 95 (cri.georgetown.edu).
Picture yourself in your early 80s, still enjoying the Venice Boardwalk and morning coffee from that favorite spot on Abbot Kinney Boulevard. You’ll want your savings to be there for you, not running on empty. Longevity risk is the fancy term for this – essentially, the risk of outliving your savings. Many retirees plan for 20 years, but you might need to plan for 30 or more. In high-cost areas like Venice, outliving your money is a real concern because everyday expenses (from groceries to utility bills to that occasional dinner out) cost more here and will keep rising with inflation.
Local Insight: Thanks to Venice’s walkability and year-round outdoor lifestyle, retirees here rack up far more “active minutes” than the national average. Great for health—yet it means your hobby budget may need to last 30 years, not 20. When we model cash-flow for local clients, we assume at least three decades of fitness dues, tennis league fees, and travel, indexing each expense at 3% inflation. Build in those “fun costs” so a longer life still feels like Venice, not penny-pinching.
Tax Shifts Ahead — Prepare Before 2026
Misconception: Future tax rates will match today’s.
Reality: Federal brackets are scheduled to rise in 2026.
Action step: Use partial Roth conversions now and diversify across taxable, tax-deferred, and tax-free accounts.
Retiring in California comes with some unique financial factors. We enjoy the benefits of wonderful public services, but we also recognize that California has high taxes. Income from retirement accounts or pensions can be taxed by both the federal and state government (the good news: Social Security benefits are not taxed in California, though they can be taxed at the federal level depending on your income). A significant risk that many overlook is future tax changes. Tax laws aren’t set in stone – they change over time. For instance, current federal income tax rates are low by historical standards and are scheduled to increase in 2026 if recent tax cuts expire (taxfoundation.org). In practical terms, today’s 12% federal tax bracket will revert to 15%, the 22% bracket goes to 25%, and so on, unless new legislation prevents it (taxfoundation.org). This means a retiree’s tax bill could go up in a few years, taking a bigger bite out of retirement income.
Government policy changes can also impact your retirement security. One looming example is Social Security’s future. You’ve probably heard rumors about Social Security “running out of money.” While it’s not going bankrupt in the sense of disappearing, the Social Security trust fund is projected to be depleted by the early 2030s. If Congress does nothing, benefits would be cut by roughly 20-25% around 2033-2034 (crfb.org), (ssa.gov) because ongoing payroll taxes would only cover about 75-80% of scheduled benefits. It’s hard to imagine lawmakers not addressing this in time, but it’s a risk to keep an eye on, especially if you’re heavily reliant on Social Security. Likewise, Medicare’s finances are under pressure too – which could mean higher premiums or other changes down the road.
Policy changes might also include things like adjustments to Medicare coverage, changes to required minimum distribution rules for retirement accounts, or new state programs (for example, California has explored state-sponsored long-term care insurance initiatives). The key takeaway is that flexibility is important. Stay informed on changes in tax laws and retirement-related policies. For example, if tax rates rise, you might benefit from having some Roth savings (tax-free in retirement) to draw on, or consider converting some funds to Roth while rates are lower. If Social Security changes, you may need to adjust your filing strategy or savings rate. It can help to work with a financial planner or tax professional – someone local who understands California’s specifics – to keep your plan updated.
Local Insight: The median Venice home has gained over 27% in the last 12 months Redfin. Selling a long-held property could trigger sizable capital-gains tax unless you’ve lived there two of the past five years and qualify for the $250k/$500k exclusion. Work the sale into your tax map early—pair it with Roth conversions or higher charitable giving in the same year to flatten your bracket creep when federal rates jump in 2026.
Long-Term Care – The Wild Card Expense
Misconception: Family will handle all care.
Reality: About 70% of people over 65 will need paid care and Medicare does not cover it.
Action step: Price long-term care insurance in your 50s or earmark assets for care.
If you’ve ever had a family member require extended care at home or in a nursing facility, you know how expensive long-term care can be. Unfortunately, this is a wild card that many retirees in Venice don’t like to think about – after all, it’s more pleasant to plan for travel and hobbies than to imagine needing a caregiver or moving into an assisted living home. But ignoring this risk won’t make it go away. About 70% of people over 65 will need some form of long-term care in their lifetime, according to government estimates, whether that’s help at home with daily activities or a stay in a nursing home.
The cost of long-term care in California is among the highest in the nation. Here in the Los Angeles area, a semi-private room in a nursing home costs around $126,000 per year on average, and a private room can run over $160,000 per year (medicaidplanningassistance.org). These costs have been climbing steadily and will likely continue to rise. Home care isn’t cheap either – hiring in-home help or paying for assisted living can easily cost several thousand dollars a month. Importantly, as mentioned earlier, Medicare does not cover ongoing long-term care (it only covers short stints, like up to 100 days after a hospitalization (medicaidplanningassistance.org). Once Medicare’s limited coverage runs out, you’re on your own to pay for care unless you qualify for Medicaid (Medi-Cal in California), which has strict income and asset limits.
Local Insight: Westside caregivers charge more than the statewide norm because of traffic and demand. A reputable agency quotes $34–$38 per hour for licensed aides, and vacancies in Venice-area assisted-living facilities are tight. Secure a “Good Health” discount on long-term-care insurance by applying in your 50s, or earmark at least two years of facility costs—about $320k—in a conservative, liquid account.
Case Study: Mark & Lisa on Rialto Avenue
Mark (66) and Lisa (64) own a $2.3 million bungalow two blocks from the Boardwalk. They expect $110k a year in combined Social Security and investment income. Working together, we:
Shifted taxes forward: Converted $200k of Mark’s IRA to a Roth in 2024–2025, keeping them in the 22% bracket before it reverts to 25%.
Built a healthcare reserve: Set aside $250k in a high-yield cash bucket for future premiums and out-of-pocket costs.
Insured long-term care: Bought a shared-benefit hybrid policy providing $8k/month for up to five years.
Stress-tested longevity: Ran projections to age 100 under three market scenarios; even in the “bad decade first” model, their plan holds. Result: Mark and Lisa now spend confidently, season tickets at the Marina Racquet Club, art walks on Abbot Kinney—knowing the big four risks are covered.
Takeaways and Next Steps for Venice Retirees
Planning for retirement is about more than just hoping the stock market treats you kindly. Especially in a vibrant, high-cost community like Venice, you’ll want to prepare for these less obvious risks so you can enjoy the beach sunsets with peace of mind. Here are a few key takeaways and next steps:
Budget for rising costs, especially healthcare.
Plan for a long life—assume at least age 95.
Stay flexible and informed about tax and policy changes.
Have a clear long-term care game plan.
Explore strategies to retire early—years sooner if your numbers allow.
Finally, remember that you’re not alone. Many retirees in 90291 are navigating these same questions. It can help to speak with a local retirement counselor or join a community group for seniors – sometimes you’ll pick up creative tips from neighbors facing the same challenges. Retiring in Venice is a wonderful adventure, and with a bit of foresight for these hidden risks, you can keep it that way. Here’s to enjoying that California sunshine and salt air, knowing you’ve got a plan for whatever comes next in your retirement journey!
FAQ
Q: What does long-term care cost near Venice, CA?
A: A private nursing-home room in Los Angeles County averages $160,000 per year.
Does California tax my Social Security benefits
Q: Are my Social Security benefits taxed by California?
A: No. California exempts them, but the IRS may tax up to 85 percent depending on your income.
Q: How can I lower retirement taxes before the 2026 rate hikes?
A: Consider partial Roth conversions while today’s lower brackets are still in place.
Q: How high is property tax on a typical Venice home?
A: L.A. County’s effective rate is about 0.6% of assessed value, so a $2 million home owes roughly $12,000 a year (Property Tax 101).
Q: What happens to my Medicare costs if my income spikes in retirement?
A: Two years later, Medicare checks your tax return. If modified AGI tops $103,000 single / $206,000 joint (2025 figures), Part B and Part D premiums jump via IRMAA surcharges—another reason to pace Roth conversions.
Ready to see if your retirement plan can weather Venice’s hidden risks? Schedule a free 15-minute retirement check-up today—no jargon, no obligation, just clear answers.
Gustaf Rounick, CFP®, ChFC®
Citations
Thought inflation was bad? Health insurance premiums are rising even faster - Los Angeles Times https://www.latimes.com/business/story/2025-03-10/kaiser-health-insurance
Disclaimer
The content provided by Westlight Wealth is for informational and educational purposes only and does not constitute investment, tax, legal, or other professional advice. Westlight Wealth is a registered investment adviser in the State of California. Past performance is not indicative of future results, and no representation is made that any strategy will or is likely to achieve its objectives. This material reflects our views as of the date published and is subject to change without notice. You should not rely solely on this information when making financial decisions; please consult your own financial, tax, and legal advisors before taking any action. Westlight Wealth does not guarantee the accuracy or completeness of the information contained herein and expressly disclaims liability for any errors or omissions.
