How much you'll really spend in retirement

Discretionary expense goes up, non discretionary expense goes down. In theory, I can survive on 70% of pre-retirement income, but I have a large travel budget because I have more free time now. It’s unheard of before retirement to take 2-4 months in Europe and elsewhere.
 
I guess if I look at it through the lens of the article (retirement expenses as a % of current salary), we will be at about 20%. But holy heck fire, we don't need to spend anywhere near what we are making now. That's why we're saving 50% of our gross income.
 
Don't forget a lot of the discretionary expenses will be front-loaded.

E.g. statistically there's more travel in your 50s/60s vs. 70s/80s.
 
Agree, those articles are worthless. Spending is very personal based on widely varying needs and wants.

Our spending intentionally increased on retirement yet only spending 2% of investments combined with pension.
Modest lifestyle habits are hard to break.
 
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.
 
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2lhasas said:
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
Click to expand...

You are not joking, right? Holy toledo!

The healthcare I get. The rest? You have got to be kidding me!

$21k per year for cars? OK, maybe Manhattan and includes parking that BMW?

$450 per week on dining out? Woah!

WSJ readers must be doing good. No wonder they demand a paywall.

Libraries are free. Volunteering is almost free. But I guess if you live the WSJ life, then you are so self centered you have to fill it up with riding horses to the country club?

I just cannot connect with that lifestyle.
 
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That's only $170,160/year. There's no tax. No travel. No grooming, spa costs, clothing, shopping, etc...

And where to get horses for $120/month? A horse rocker or a merry-go-round?

Who can live on just $170K/year?
 
NW-Bound said:
That's only $170,160/year. There's no tax. No travel. No grooming, spa costs, clothing, shopping, etc...

And where to get horses for $120/month? A horse rocker or a merry-go-round?

Who can live on just $170K/year?
Click to expand...

The "riding horses" is kind of odd. At our regular barn, even a group lesson is $60 a week if you don't own your horse...only $25 if you do, but then stable fees are about $600/month.
 
I plan to spend all of it, if I can just get the timing right... [emoji15]
 
Our expenses are much less in retirement as we have more time for optimizing expenses, DIY, price shopping and bargain hunting. I don't even spend $400 a month for groceries let alone a week. My last trip to the outlet store I spent $70 for groceries that would have cost $280 at regular supermarket prices. This weekend we have a music crawl, tribute band concert and beer festival planned and each event is either free or I was able to get comp tickets, so we just have to pay incidentals like gas and bridge tolls. We used to spend a lot more so I know it is easy to do, but we feel like we have more control over our budget and expenses these days and still have the same or better lifestyle.
 
candrew said:
I think it fair to say that most FA's will attempt to convince people that they will *need* 70-100% of their pre-retirement income to live comfortably after their days of wage slavery end. That is not always sound advice and does serve the interests of the FA!
Click to expand...
+1

I can't remember a poster on this board who simply accepted the 70% crude estimate. We all give this a lot more thought.
 
My expenses are pretty much the same as they were when I was working. When I was putting together my ER budget, I used my current expenses with 2 main adjustments: I eliminated FICA taxes and commutation expenses and added those savings to my health insurance costs. Everything else was unchanged.


Sure, in the last 10 years, the HI has risen, dropped, then risen again to slightly higher than it was in 2010 (because/despite some health issues in the last 3 years). My other expenses overall have risen a little over the years, although some have fallen while others rose. Income taxes don't faze me because they only spike upward if my income spikes upward, too.


And just to continue with my earlier post about "Which income should I use, my FT one or one of my PT ones?" I would say the 70% is applicable only to my lowest PT salary (which was 1/3 of my FT salary).
 
I am in my 9th year of retirement. My average annual spending is under 45% of my gross salary when working. This <45% is a whole lot more than what I was spending while working.

It must be nice to be living in la-la land where working people spend their entire gross salary. :ROFLMAO: That's not the world I ever lived in. :rolleyes:
 
Independent said:
+1

I can't remember a poster on this board who simply accepted the 70% crude estimate. We all give this a lot more thought.
Click to expand...

Exactly. Because 99% of us aren't spending anywhere near 70% for the decades before we retire either. We're too busy saving it.

After our first 2 years, we're spending about 1/3 of our gross, less than half of our after-tax.
 
2lhasas said:
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
Click to expand...
Yikes

$170,160 per year

And, I don't see clothes, charitable contributions, phone/internet/cable, or travel.
 
Yes, some people can "blow some dough", but know how to get amazing deals on horses.
 
The budget is not ridiculous for some of us but the categories problaby are. Didn’t we just have a FAT fire thread?
 
2lhasas said:
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
Click to expand...

My heartfelt thanks goes out to those individuals spending this kind of dough in retirement. Your sizable contributions to continued economic growth and full employment is appreciated. The more, the merrier, I say (Please consider spending a few more $$ if buying a gift for me).
 
We spend about the same in retirement that we did while I was working.... in both cases have two homes, perhaps a little more travel and recreation, but pretty much the same overall lifestyle.... just more play and less work. After my first year of retirement I started a monthly automatic withdrawal from savings and that withdrawal is the same amount 6 years later... though I did start my small pension (which was 20% of our monthly withdrawal) a couple years ago which is part of the reason why I haven't had to adjust that monthly withdrawal for inflation.
 
I need to teach a class with Robbie on how to spend more in retirement. Since I’ve got back from my long European trip I bought a slew of things, upgraded new furniture, new fridge, new grill, new bedroom set, new tech center, etc..
I like to think I’m a patriot. :D
 
JoeWras said:
But I guess if you live the WSJ life, then you are so self centered you have to fill it up with riding horses to the country club?

I just cannot connect with that lifestyle.
Click to expand...



Me neither. Nobody rides their horses to the country club any more. One allows them to Uber.
 
Easily spend 130%. Retirement is fun, enjoyable. A lotta travel to Europe for many weeks at a time, cost money. The experience is great but expensive. The day will come when my wife and I can’t do it anymore, so now is the time.
 
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