How much you'll really spend in retirement

[RobbieB]

Yeah, averages.

I spent 45 grand on a car a month ago and I spent three grand last week on my step daughters UCLA orientation. We had a good time at Disneyland and Universal while she was oriented.

Four grand this week on getting the popcorn ceilings removed, re-textured and repainted.

Blow That Dough!

[Retired Expat]

Quote:

Originally Posted by Red Badger Somewhat interesting. I am not a big fan of rules of thumb. To me, it's akin to when to retire; when to pull SSI. All very personal. But the article does suggest to analyze spending plans in detail. That's good advice that stands the test of time. Prior to retirement, we lived modestly, but comfortably, on less than 50% of my gross pay. In retirement, we're spending more than that. However, it is still well below 70% of working gross income. Got my hair cut today. Almost $40 all in (beverage, tip, etc). My barbershop is located inside a pub and doesn't hire kids. Nothing against kids, but, like doctors and pilots, I like my barber to have lots of experience. YMMV!

See that is why I retired to South America. A haircut costs $6 or 8 if you want a wash too. Although I here the dollar is up so probably $6... but obviously there are lots of things that cost more.

One of the considerations to make in retirement however is you have more time to find better values for your money. Spend more time managing investments and expenses, take advantage of mileage bonuses on credit cards and earn that free travel... etc. There are many simple things to do to save money that I never had time for before... make your own Bbq sauce or rubs, grow more veggies, shop in bulk and repackage. Helps if you have a vac saver.

It is also healthier living.. use store bought stock? Now we save the veggie trimmings and leftover chicken bones in the freezer and periodically make our own stock, shop less, less packaging and you know what you are eating....plus it seems like a money saver!

[NW-Bound]

Quote:

Originally Posted by daylatedollarshort The average annual expenditures for households 65+ in 2017, according to the Consumer Expenditure Tables, was $49.5K.

$50K for an elderly couple over 65 is not unreasonable, when you have no mortgage nor car payments, all children grown and needing no support, you are old and have enough of travel, can't eat nor drink that much, do not care for much, etc... And if your body aches, all you want is for the pain to subside, and yet no money can buy you that.

I am not there yet, but can imagine myself getting there. Heck, I still have a couple of years to get to 65.

[kgtest]

Quote:

Originally Posted by RobbieB Yeah, averages. I spent 45 grand on a car a month ago and I spent three grand last week on my step daughters UCLA orientation. We had a good time at Disneyland and Universal while she was oriented. Four grand this week on getting the popcorn ceilings removed, re-textured and repainted. Blow That Dough!

Love it! You are one of my few hero's lol. Do you have those fancy rounded edge corners on your walls? You need to do that to the place it would look nice with the new ceilings!

As for averages. I have my spending (prior 5 and next 13years to 2031 ER) at about 111% of my current spend working yrs (over next 18 years).

But in RobbieB fashion, the next 18 years, from 69 to 87 (if I'm so lucky) spend will increase 333% from my next 18 years of working essentially doubling quality of life every 6 years over a nice glide path.

Will I need to live on a quarter million/yr in 36 years? Hard tellin but I optimize out to 90 with a nicely funded trust for the heirs. Could be 1 million, could be 7 depending on where the world takes me.

RE is also some component that with all the equity beyond principle residence, would likely prop any downturn of that fourth leg up if needed.

[pjigar]

Quote:

Originally Posted by HarveyS The article said 70-130% of pre-retirement salary - not spending. IMO a big difference for most of us here as savings was a big part of our salary. For me, I am living in retirement at about 50% of my average salary. (average of the last 5 years before RE)

I think they may have forgot to adjust for inflation! I NOW pay income tax which is about 120% of my salary 20 years ago! Nominal numbers a funny.

[scrabbler1]

Quote:

Originally Posted by 2lhasas This article (granted, in a NY based publication) assumes a pretty fat retirement. $400 a week on groceries $450 a week on dining/drinking out $120 a week on entertainment (concerts, sports etc.) $90 a week on gifts $120 a month on riding horses $1,800 per month on car payment/insurance/maintenance $8,000 annual country club membership $4,000 per month on housing (including insurance) $3,000 per month on healthcare Part of their analysis was based on an assumption you would back fill the 8-10 hours a day you were no longer working with expensive hobbies and trips to the spa. I have actually found the opposite. Now I have time to pursue the many free entertainment options in our area that I was just to tired to attend before. I have time to cook, whereas we ate out a lot when we were both working 60 hour weeks. I have time to go to the library instead of ordering a book on Amazon. In a couple of years, we plan to go down to one car. I would say the only increases are in travel expenses and electricity - because I'm now home during the day.

Fat? To me that's morbidly obese! The total is about 5 years of spending for me. And I didn't see income taxes in the list.

[henny-penny]

I will probably spend 3 times as much as I spend now when my partner is gone. With 20 years difference I will have one spending level when he is alive and completely different spending level when I have to pay everything myself. 2 persons living under one roof is much cheaper per person than living alone.

[Dtail]

Quote:

Originally Posted by scrabbler1 Fat? To me that's morbidly obese! The total is about 5 years of spending for me. And I didn't see income taxes in the list.

~165k yearly spending in the example.
I believe there was a forum poll with ~20% of the results being >120k yearly.

[GravitySucks]

Quote:

Originally Posted by henny-penny I will probably spend 3 times as much as I spend now when my partner is gone. With 20 years difference I will have one spending level when he is alive and completely different spending level when I have to pay everything myself. 2 persons living under one roof is much cheaper per person than living alone.

I didn't increase that much, but taxes go way up when you're a single and the chores they take on as theirs over the years still need doing. For instance i would need a maid service twice a week to keep the place as clean as when DW was healthy, on top of what I do. It's probably slightly less than what two would pay to live overall. Higher taxes, lower health care and food. Utilities, insurance, pet supplies all stay the same.

[braumeister]

My spending has been all over the map. Here's a chart of the last 11 years:

Spending 2007-17.png

I don't worry about it; it is what it is.

[PointBreeze]

Quote:

Originally Posted by henny-penny I will probably spend 3 times as much as I spend now when my partner is gone. With 20 years difference I will have one spending level when he is alive and completely different spending level when I have to pay everything myself. 2 persons living under one roof is much cheaper per person than living alone.

My DP is 15 years older than me, and I anticipate very little reduction in household expenses when she dies, but unfortunately will lose her SocSec and 2/3 of her $$ (her children's inheritance).



Made it tricky to plan. I appreciate the fact that some of the free online retirement planners gave me ways to model for that.

[tdv2]

Quote:

Originally Posted by daylatedollarshort I'll spend what we've budgeted or less in retirement. If I spent more I'd run out of money.

+1

[Dtail]

Quote:

Originally Posted by tdv2 +1

+2 that's the plan.

[Moemg]

Quote:

Originally Posted by NW-Bound $50K for an elderly couple over 65 is not unreasonable, when you have no mortgage nor car payments, all children grown and needing no support, you are old and have enough of travel, can't eat nor drink that much, do not care for much, etc... And if your body aches, all you want is for the pain to subside, and yet no money can buy you that. I am not there yet, but can imagine myself getting there. Heck, I still have a couple of years to get to 65.

We are an elderly couple at 71 &72 .We may have grown children but we have eight grandchildren that require lots of pampering . We still eat out two times a week and most of our elderly friends eat out a lot more than that . We still travel and are willing to pay more to make travel easier .We live near a large community of older people and they are all still spending and enjoying their life until something stops them.

[braumeister]

Quote:

Originally Posted by NW-Bound an elderly couple over 65

Thanks for the good laugh. These days, 65 is a long way from "elderly" for most of us.

[Teacher Terry]

My mom traveled until 84, ate out until she died at 90 and bought something if she wanted it.

[Fedup]

In my bridge club, there is this youngster who is 92. She still drives, and do all kinds of exercise. She told my husband to do all kinds of aerobic exercise to stay healthy. I believe she travels frequently to see all her kids, they are all over the place. When I get a chance I’ll ask if she lives alone. I suspect she doesn’t.

Both of my aunts are in their early 90s but they have slowed down, not as energetic as this lady.

[NW-Bound]

Quote:

Originally Posted by braumeister Thanks for the good laugh. These days, 65 is a long way from "elderly" for most of us.

That's what you think.

Quote:

Originally Posted by Fedup In my bridge club, there is this youngster who is 92...

You do not see the ones who did not make it. Heck, many posters on this forum stopped posting, and I found out why.

Let me just say they were a lot closer to 65 than 92.

[Fedup]

Quote:

Originally Posted by NW-Bound That's what you think. You do not see the ones who did not make it. Heck, many posters on this forum stopped posting, and I found out why. Let me just say they were a lot closer to 65 than 92.

Yeah, my brother told me one of his work friend just passed away at 61, one year older than him. This guy got laid off and retired 2 years ago. He died while playing tennis. Interestingly enough, my brother used to text him to go for coffee every other Friday, this time he didn’t reply and two weeks later my brother found out he had he died.

I say some people die young.

[NW-Bound]

Quote:

Originally Posted by Fedup He died while playing tennis...

I do not play tennis and never will.