Depressing Thoughts about Retirement

[jollystomper]

As others have said in various (and probably better) ways, I:
- figured out what we wanted to spend to lead an "extravagant" (our definition) retirement lifestyle.
- Saved and invested to have enough to address that goal (factoring in the desired non-cola pension amount I wanted)
- Worked to build a "buffer" above and beyond that as a cushion

If you have a family, you are likely naturally spending less if your kids are not dependent on your and you have an empty nest. That was certainly a factor in our case, and was part of my retirement timing.

Since I have recorded our spending in Quicken for years, for grins I compared spending for the five year period before retirement, and my five year period after retirement:

• Before retirement: average $165,518 per year
• After retirement: average $116,107 per year (below our planned retirement spending that would start at $125K/year and adjust for inflation)
• Biggest spending increases: vacation (of course), medical (but still well below what we budgeted), auto (car purchase), gifts, recreation
• Biggest spending decreases: taxes, college expenses, charity( since income is down), household (took care of a lot of improvements before retirement), food

In general, our "extravagant" lifestyle means more spending on ourselves . My initial five-year plan has concluded ("post-retirement pre-medicare"), I am working on the plan for the next five years ("post-medicare pre-SS"), assuming all goes well.

 

[Mulligan]

I'm one of the less wealthy ones on here - and I absolutely spend more than while working. I don't even think of myself as retired, I think of myself as financially independent. I saved hard while working, how hard I didn't appreciate, until I stopped saving. Easier when one is single, I grant.

I try to think of what I missed out on by not spending. Better furniture, I guess, would be the one big thing, as I don't care about designer items, or a bigger car. I delayed traveling much until I was 50, but made up for it after that.

I not wealthy either. My pension is COLA’d and is higher than when I worked so I can maintain my preretirement lifestyle. I havent increased my spending so my investment money continues to grow as I dont need it to live off of. But the damndest thing happened to me after retirement. My desire to travel gets less and less each year, and I am not even 60 yet.
My lady will be retiring in a couple years and mentioned wanting to go to Europe. It just came out of my mouth before I even thought, as I said “Cant you find one of your girlfriends to go so I dont have to?”
Past year I went to St John USVI for a week, Vegas for 5 days, and going to Mackinaw Island and Door County in September. That is plenty in a years time for me, and I would just do one or two if she wasnt pushing me to go somewhere.
I would rather golf 5 days a week and bet on sports the other 2 all the time, lol.

 

[LateToFIRE]

...But the damndest thing happened to me after retirement. My desire to travel gets less and less each year, and I am not even 60 yet...

Same here. Maybe from being a road warrior for 35 years, and already done most of the big vacation travel stuff wanted to do, thankfully when we were younger and more energetic. No desire to repeat any of it. Just can't look forward to another Airport/TSA/Airline experience and then wedged into an airborne tin can for several hours with a couple hundred of my fellow human beings, at least a handful of whom are bound to suffer from severe personality disorders.

 

[Koolau]

Same here. Maybe from being a road warrior for 35 years, and already done most of the big vacation travel stuff wanted to do, thankfully when we were younger and more energetic. No desire to repeat any of it. Just can't look forward to another Airport/TSA/Airline experience and then wedged into an airborne tin can for several hours with a couple hundred of my fellow human beings, at least a handful of whom are bound to suffer from severe personality disorders.

Yeah, just the yearly travel from home to the mainland has gotten to be such a hassle. I hate every minute of it. Of course, I always remind myself that it's just one day (heh, heh, unless a flight gets cancelled.) So, I actually hate travel now. I like to visit new places and visit with friends, but the actual travel is no fun any more. Anyplace I can drive in a day is okay, because my big ol' land cruiser Buick is comfortable. Much more so than an airplane. Plus, I can stop and get out when I want to. YMMV

 

[Surewhitey]

Same here. Maybe from being a road warrior for 35 years, and already done most of the big vacation travel stuff wanted to do, thankfully when we were younger and more energetic. No desire to repeat any of it. Just can't look forward to another Airport/TSA/Airline experience and then wedged into an airborne tin can for several hours with a couple hundred of my fellow human beings, at least a handful of whom are bound to suffer from severe personality disorders.

Same here @52. I prefer a good road trip now as much as dealing with the airport. We drove home from Breckenridge the other day. Left 3 hours before the kids (flying home to Dallas). We both arrived at the same time and we enjoyed the scenery... They sat on the tarmac with a not so pleasing view & got to see someone get punched in the face... Too many crazies out there.

 

[Koolau]

Same here @52. I prefer a good road trip now as much as dealing with the airport. We drove home from Breckenridge the other day. Left 3 hours before the kids (flying home to Dallas). We both arrived at the same time and we enjoyed the scenery... They sat on the tarmac with a not so pleasing view & got to see someone get punched in the face... Too many crazies out there.

Yeah, we don't do air within the mainland. Maybe we would if we flew all the way to the west coast - but we have no reason to. I prefer a two day drive to two domestic flights.

Yeah, it's getting scary in the air. Tempers flair when flights are not on time and no one lets you know what's going on. I had a "fight" with a lady behind me a couple of years ago. The person in front of me reclined, and I had no space. So I reclined and the lady behind me pushed my seat back up. I told her I need to recline and she said NO! I called the flight attendant who set the lady straight. I could have been a statistic!

 

[Stormy Kromer]

I'm sure you're right about knowing when the pension vests. I knew when my pension would vest, but it never occurred to me to retire on that date. My retirement was driven by whether I was still enjoying what I was doing at w*rk. Reaching my pension-vest day gave me "freedom" it's true. I could have quit and maybe looked for another j*b or just relaxed and FIRE'd based on my assets. BUT I still enjoyed what I was doing. The DAY I didn't, I retired (with about 3+ weeks notice - but I was on vacation at the end of the week until I actually retired.)

The "unique" part is I never heard of planning 30 years ahead to retire on your vest date. Maybe it's not unique, but it's unique to me. And I've never heard that here. YMMV

I did, I wrote down my retirement plan in a spiral notebook with a pocket calculator and pencil. It all started when I told a very accomplished gentleman in our home town " I wish I had a pension like government workers so I could retire in 30 years" I had just bought a business and was self employed.

He responded "You can, just start your own pension savings plan and save 30% of your income for 30 years and invest in stocks through good times and bad and you'll be there" I did, it worked.

 

[W2R]

The "unique" part is I never heard of planning 30 years ahead to retire on your vest date. Maybe it's not unique, but it's unique to me. And I've never heard that here. YMMV

Oh I knew the exact date when I would/could retire from the first week I was employed by the federal government! I always planned to retire on that date (which was also the date when I qualified to carry my health insurance on into retirement).

What really upset me, when the time came, was that date (11/7/2009) was on a Saturday. I reluctantly decided to wait until the following Monday (11/9/2009) to retire, so that there wouldn't be any question about my eligibility. Sounds minor but those two extra days seemed pretty tough to endure at the time.

 

[Mulligan]

Oh I knew the exact date when I would/could retire from the first week I was employed by the federal government! I always planned to retire on that date (which was also the date when I qualified to carry my health insurance on into retirement).



What really upset me, when the time came, was that date (11/7/2009) was on a Saturday. I reluctantly decided to wait until the following Monday (11/9/2009) to retire, so that there wouldn't be any question about my eligibility. Sounds minor but those two extra days seemed pretty tough to endure at the time.

I was a mental midget at first with my pension. In my 20s I viewed that 14% withholding for my pension as a tax on my income I could spend. Who ever gets old anyways? As I started nipping at 40, I started to “see the light” and importance of that withholding.

 

[Koolau]

Oh I knew the exact date when I would/could retire from the first week I was employed by the federal government! I always planned to retire on that date (which was also the date when I qualified to carry my health insurance on into retirement).

What really upset me, when the time came, was that date (11/7/2009) was on a Saturday. I reluctantly decided to wait until the following Monday (11/9/2009) to retire, so that there wouldn't be any question about my eligibility. Sounds minor but those two extra days seemed pretty tough to endure at the time.

Okay, okay, if W2R planned her retirement date based on when her pension vested, then I stand corrected! It's NOT unique.

I guess it just SOUNDED unique.

 

[Badger]

I never saved/invested so I could travel and spend at a higher level once I retired. Since we had modest incomes as teachers in Florida my objective was to make sure we didn't become dependent on cat food for dinner and my wife would be financially secure if I go first. So far it appears that the plan is working with a bit of a buffer as a bonus. No depressing thoughts here.

Cheers!

 

[Chuckanut]

I was a mental midget at first with my pension. In my 20s I viewed that 14% withholding for my pension as a tax on my income I could spend. Who ever gets old anyways? As I started nipping at 40, I started to “see the light” and importance of that withholding.

One year after the stock market went up, Up and UP most of the year, I found that I had earned more money on my investments then I had at my job. It’s then that the reality of a sound long term investment plan really hit home.

 

[SnowballCamper]

I don't get what is depressing about this at all...

He said "isnt it strange that we save our entire lives so that we can retire, and we choose the goal-line as the point in time where we don't have to work to support our current way of life."

One of the fundamentals of retiring early is clearly to avoid living beyond your means, but what if what you want out of retirement involves spending more, traveling more, seeing more, doing more?

If you want more then you have to work more, or differently to earn more, or save more, etc. It's just the way the world works... nothing to be depressed about.

I'm very happy that I don't have to work anymore.

 

[Music Lover]

If you want more then you have to work more, or differently to earn more, or save more, etc. It's just the way the world works... nothing to be depressed about.

You can also choose less expensive hobbies and entertainment options.

 

[Retired Expat]

We don’t spend more or less in retirement than we did while working. We just spend it differently. Moved to a low lost of living area, cut the cords on cable, TV and the like, cook at home much more by choice not necessity. Not spending money to accumulate stuff anymore (just the opposite in fact.

We also rejiggered some of our investments to generate regular cash flow so our withdrawal rate is under 1%. Although now that SS is on the horizon in 3 to 6 years am starting to think about spending more.

We also do a lot of things to lower expenses like home exchanges for travel. Pet sitters who want to travel to our area instead of paying some one to board them. Use AirBnB which saves big $ over hotels, Really work the travel perks from miles or CC and even earn miles when we sold our home. That and no great desire to upgrade stuff that still works fine. Lost quite a bit of weight and all those clothes that haven’t fit in years and years are like new! But the new 75” Tv with the jaw dropping clarity for 1000’s of dollars? Why. Newest computer? Why? And we actively seek out less expensive alternates

We travel a lot and it was always $200+ for a taxi each way to and from the airport. Sometimes on both ends of departure and arrival. Now we check Uber, Lyft and one way car rentals. Will save over a $1000 this year on just the travel to or from the airport by driving ourselves there or home. Gotta work it however!

 

[Jeffman52]

I got divorced about 16 years ago and had to start over. I remarried and my DW and I got serious (but not too serious) about saving for retirement. We wanted to save but also to enjoy many of the things we wanted to do. We enjoyed many great vacations, Skiing every year at different places, wine trip to Sonoma, many trips to the North Georgia mountains. We are going to Italy in November, and Big Sky Montana to Ski this coming February. We will retire next year which is a little early but not as early as many retire. Its our journey though and we have planned pretty well for the balance of it financially.

 

[clifp]

This is why I have always said that, in retirement planning, the first thing you need to know is how much you want to spend. Everything else flows from that. If your friend wants to do ______ in retirement, then he should figure out what ______ will cost and work backward from that. Retirement is not going to be much fun if you first pick a number, retire and only then find out that you can't do ______ within that number.

I think the first step is to really measure how much you are spending while working. In general, you'll have more time and more flexibility, so you can spend less, e.g. make your lunch rather than eat out, no commute, go to matinees, and travel during off-peak times. You'll also have more time so you may spend more money on hobbies and travel.


I think it is very much an iterative process. How much will have when I retired, how much can I spend on my stash can I spend every year, and then how much longer do I want to work in order to support a particular lifestyle.

One nice thing, I've noticed about long-time forum members, is that combination of our natural frugality, and great housing and stock market over the last 14 years, is we aren't worried about our spending anymore.

 

[Gumby]

I think the first step is to really measure how much you are spending while working.....

And that's a real problem. So many people just can't be bothered to track their spending. I did it for 20 years before I retired with nothing more complicated than a home made Excel spreadsheet. A couple of my work colleagues asked me to help with their retirement planning and I gave them my formatted spreadsheet to help nail down their spending, but they never used it.

 

[Mulligan]

And that's a real problem. So many people just can't be bothered to track their spending. I did it for 20 years before I retired with nothing more complicated than a home made Excel spreadsheet. A couple of my work colleagues asked me to help with their retirement planning and I gave them my formatted spreadsheet to help nail down their spending, but they never used it.

Im in process of dragging my GF across the finish line into retirement in three years, which I already know I will be plugging the holes a bit but that is all right.
Anyways, I told her we need to know how much she spends each month. She said she had no idea. So I had to do the work backwards for her. Saw her pay stubs, saw the net income, and backed out the extra she has saved on the side since living with me. She has no debt other than car payment and the monthly water bill she insists on paying.
It took me about 3 minutes to figure out her “number” needed despite her not having a clue, lol.

 

[Surewhitey]

It took me about 3 minutes to figure out her “number” needed despite her not having a clue, lol.

It's just math... I still help DW with % of one # as a part of the whole... She's the people person though.

 

[LateToFIRE]

Im in process of dragging my GF across the finish line into retirement in three years, which I already know I will be plugging the holes a bit but that is all right.
Anyways, I told her we need to know how much she spends each month. She said she had no idea. So I had to do the work backwards for her. Saw her pay stubs, saw the net income, and backed out the extra she has saved on the side since living with me. She has no debt other than car payment and the monthly water bill she insists on paying.
It took me about 3 minutes to figure out her “number” needed despite her not having a clue, lol.

Yeh, regarding spending, I took several approaches, as our pre-retirement spending is a bit complicated, but at least everything flows through our checking account in one form or another.

1) First I took an income approach: added up my take-home pay, plus rental income, dividends , and any other type of income that flows into checking acct., made some adjustments for certain costs that will be voided in retirement, adjusted for one-time items, added in some expenses that will crop in retirement, subtracted the leftover surplus, and voila, got our number.

2) Second approach is spending method, downloaded all debits from the checking account, made adjustments as described in #1, and viola.

3) Third method is estimated expenses, did an itemized estimate with the usual categories, plugged in what numbers I know, SWAG'd what I don't quite know, and boom, yet a 3rd number.

Fortunately, all three approaches landed within 4% of each other so I have a pretty good sense of accuracy!

The budgetary wildcards are:

A) What are the lumpy expenses going to be (ex. big maintenance, upgrades on the house, replace vehicles),

B) What new hobbies, toys will we want to indulge,

C) What will taxes really look like, and

D) How rapidly will our costs inflate/deflate?

E) Should we keep our 3% mortgage and/or how long should we keep it

F) What's our charitable going to look like going forward (currently quite hefty)

So at least now I have a solid number I know we can live within, and then I can fluff out that number to see just how large we could live without endangering our finances.

 

[MercyMe]

And that's a real problem. So many people just can't be bothered to track their spending. I did it for 20 years before I retired with nothing more complicated than a home made Excel spreadsheet. A couple of my work colleagues asked me to help with their retirement planning and I gave them my formatted spreadsheet to help nail down their spending, but they never used it.

Yup... I did the same thing. Gave a friend a blank copy of my spreadsheet, told him it takes me about 20 minutes per month to update it, and said it changed my life.

Once he saw his first monthly total, he stopped doing it as it was too sobering for his over-spending high-life.

The blind just don't want to see. Ignorance is bliss.

 

[Mulligan]

Yeh, regarding spending, I took several approaches, as our pre-retirement spending is a bit complicated, but at least everything flows through our checking account in one form or another.

1) First I took an income approach: added up my take-home pay, plus rental income, dividends , and any other type of income that flows into checking acct., made some adjustments for certain costs that will be voided in retirement, adjusted for one-time items, added in some expenses that will crop in retirement, subtracted the leftover surplus, and voila, got our number.

2) Second approach is spending method, downloaded all debits from the checking account, made adjustments as described in #1, and viola.

3) Third method is estimated expenses, did an itemized estimate with the usual categories, plugged in what numbers I know, SWAG'd what I don't quite know, and boom, yet a 3rd number.

Fortunately, all three approaches landed within 4% of each other so I have a pretty good sense of accuracy!

The budgetary wildcards are:

A) What are the lumpy expenses going to be (ex. big maintenance, upgrades on the house, replace vehicles),

B) What new hobbies, toys will we want to indulge,

C) What will taxes really look like, and

D) How rapidly will our costs inflate/deflate?

E) Should we keep our 3% mortgage and/or how long should we keep it

F) What's our charitable going to look like going forward (currently quite hefty)

So at least now I have a solid number I know we can live within, and then I can fluff out that number to see just how large we could live without endangering our finances.

Yes, it was simpler for me to do the math, because I am the one bearing all the wild card household bills and maintenance. And her health insurance is top notch, so there shouldnt be much leakage there either if something did occur. She just has to worry about all the important stuff. Gas, car insurance, food, clothes, vacations, hair, nails, toes, massages, unneeded additional clothes purchased, and useless household decoration nicknacks. I had my house built for me 20 years ago, and it didnt have one thing hanging on any wall except the fresh clean paint. Well that sure changed 3 years ago, ha.

 

[JBTX]

I’m approaching 60. Finished my last contract a few months ago. I may work some more contract work. I may not. Not sure yet.

Wife is still working and has good job and will likely work several more years until she gets to around my age. She likes her job, a lot.

We are above average spenders. Even so, if it were just her and I with two normal self sufficient adult children, I think we could both afford to retire now. But that’s not the case. So here are the unknowns for us

- younger adult child is disabled / ASD and if ever works at all it will be very nominal. He will likely need help all of his life. He is now getting SSI and will likely be eligible for adult child SSDI, but that will only cover basic needs, not living communities that can run $4k - $5k a month, or even more, if we wanted to go that route. We could not afford that in perpetuity with our savings

- older college adult child has some mental health and other issues and is not at all self sufficient yet. Will she ever become self sufficient? She has the cognitive and practical skills to do so but not as long as these mental health issues rule her life. So when, if ever, will that sort itself out? That’s impossible to determine.

On he flip side, I suspect we will get some inheritances that will somewhat mitigate the above, but am I 100% certain of it? No. It is just hard to plan for such things.

For now, I suspect I may do some travel, and work some contract on and off to level the cash flow. Currently In the middle of a 3 week trip out west with adult kids. That’s about $8k. Just found out our AC crapped at home and that’s another $9k (would be more if it weren’t for spouses employee discounts). Neither of those were planned, and are a cash drain, but we can afford them. However Ive definitely decided I want to do some travel while we can and am going to try to make it happen one way or other.

 

[clifp]

And that's a real problem. So many people just can't be bothered to track their spending. I did it for 20 years before I retired with nothing more complicated than a home made Excel spreadsheet. A couple of my work colleagues asked me to help with their retirement planning and I gave them my formatted spreadsheet to help nail down their spending, but they never used it.

Agreed.

For the first four years, after retirement. I tracked my spending carefully using Quicken and then in 2008 and 2009 during the great recession, but haven't bothered since.

I'm super suspicious of folk who ask if can we retire, When the stories start this way. "We're 55, we make $205,000 combined income.
We have 450K in taxable and 1.1 million in 401K/IRA and we spend $60,000"

The person who tells me they spend $62,400 is a far better candidate for early retirement