Originally Posted by Ready
I saw this in the LA Times today. An insightful reader questioning the logic that many financial planners use to estimate required expenses in retirement. I thought Liz's answer was pretty accurate given the limited info she was provided.
+1. No detail understandably, but I agree she covered the major bases pretty well.
I don't see anything wrong with the 70-80% as a starting point - some people are clueless and/or lazy about budgeting, it's better than nothing for them. IME, unfortunately the clueless are more common than those who have a handle on their spending/budget. I don't think anyone has ever seriously suggested that the 70-80% is some universal truth - any more than 4% SWR is.
Some people will actually spend much less, and some much more in retirement - all depends on how your retirement lifestyle/activities compare to pre-retirement. No one can/should guess what any individual should use as a $ or %...but if the questioner is clueless, you could do worse than suggest 70-80% as a starting point, and offer some caveats (like the linked article) for the questioner to ponder.