Question for retirees

[Rich Konopka]

I’m coming up on retirement in the next couple of years depending on how much I can tolerate my company management 😝

In my planning I keep hearing that you will spend more or just as much.

So if you were to choose:

Same, less, more??

Thanks

[Lee DeRaud]

Could be less, more, or same...depends completely on your hobby/discretionary habits.
It's not so much that you're spending a different amount, it's that you're spending it on different stuff.

[Jim Koepke]

I’m coming up on retirement in the next couple of years depending on how much I can tolerate my company management ��

So if you were to choose:

Same, less, more??

Thanks

Do you buy lunch and coffee? If so, you will likely spend less. If you commute any distance to work, you might spend less on gas for the car.

Do you have plans to travel when you retire? This may cause you to spend more. During my first few years of retirement, things were a bit tight. All of my income streams hadn't kicked in. We used to go out for breakfast or lunch more often. Covid changed that.

There are many factors to consider, but there is some evidence to support the earlier people retire the longer they live.

One has to take into consideration what they can afford and what they are going to do.

I worked with a lot of people who didn't want to quit working because they didn't have anything else to do. My foreworker was a very nice guy. He often said he ran the numbers and he was staying at work for fifty cents an hour more than he would be making in retirement. He died before he retired.

Too many hang on because they don't know how to let go.

jtk

[Rich Engelhardt]

Overall we spend more.
It was less though when I first retired 10 years ago.

I just figured why deprive myself of stuff I want at this stage of life.

[Ken Fitzgerald]

It really depends on how and what you do after you retire. Since I don't have to dress as I did professionally, I spend less on clothes. Since I eat lunch at home most days, my out-of-pocket expenses are less. My retirement was a bit different than most people as I awoke deaf one day. For reasons of personal safety and safety to customers equipment, I couldn't continue working. Luckily, I had paid $8/month for 24 years for long term disability insurance. That's one of those things that a lot of people will tell you don't need or criticize one as being over insured. I got the total amount back in less than 1 month. Then I continued to receive my base salary until I turned age 65 and qualified for full Social Security benefits. We were scared we couldn't afford to retire. We haven't changed our lifestyle one bit. I just don't have the option of earning a little extra money by working some available overtime. The only things we have dipped into our 401K for is extras for some really nice vacations, and some things not covered by health insurance.

My plans were to retire shortly any way so awakening deaf just made us except the move. My wife who is older than me decided to retire when I did.

The financial fears were proven unfounded for us.

Good luck with your decision!

[Ron Citerone]

I would say we are spending the same excluding travel. Our travel has been somewhat limited with the pandemic, but we did a lot of road trips and avoided longer trips involving flights.

I would say the biggest question is the cost of health benefits if you have to buy them. That is our biggest expense since our mortgage is paid and we are not quite to Medicare age.

[Mike Henderson]

For most of my working life, I was worried about whether I'd have enough to retire on. So I stuck every extra dollar into savings. Now that I'm retired and can see "the end" I'm not as worried. I won't run out of money. So my wife and I have done some traveling which means that we're spending more than I used to spend.

If you have your home paid for, you can live fairly low cost - if you want (or need) to. It's up to you and what your finances are.

Mike

[Ralph Okonieski]

I am 4.9 years into retirement. The first few years we watched expenses very closely as we decided to delay social security benefits until closer to 70. We have started to increase expenses now mostly for home improvements, resembling Rich’s thoughts on spending to enjoy it now. Even with that, we budget and follow it closely. To answer your question, we started out spending less, now we are spending more, by conscious choice.

[Jim Becker]

What you "spend" post-retirement is really up to you and by that I mean what you spend above housing/utilities/food that is your "base" cost to live where you do.

For the first five years, I probably was on parity with pre-retirement but that was somewhat by design with having a "new business" for awhile as well as subsequent moving and new shop costs. The market also supported it just fine. But that also wasn't an issue because we are a two income family and Professor Dr SWMBO has still been working. That changes at the end of the Spring Semester when she is also retiring and we've been gradually reducing some expenditures...my vehicle was paid off in three years and her's is getting there, for example. Our utility costs here at the new property are much lower than at the old one. Food costs for two are a lot less than for three/four that was the case for the first couple of years of retirement. I actually do plan on reducing my income from my IRA in January or February (more likely) to cut tax liability and that shouldn't hurt too much with the increase in SS kicking in and with other costs reduced. Think of it as "rebalancing" now that the stuff we needed to do with the new house (and new shop) are nearly complete.

[Bruce Wrenn]

A few expenses won't change due to retirement, property taxes, utilities, insurance. But if you aren't old enough for Medicare, this can be a budget breaker. When I was 59, I spent a week in the hospital from an unknown virus. At the time I was self employed, and own my own insurance. BCBS of NC rewarded me for being sick by increasing my rate from $650 a month to $1350. Because I had taught school for 6.5 years, and turning 60 I could draw my state retirement which included health insurance at no cost to me. The savings on insurance for the sixty months between that date and Medicare saved me $81,000, plus I drew my retirement.

[Sam Force]

No way around it for us, retirement was a big cut in income. We are fortunate that I get 2 pensions and wife and I both on SS. Reduced our power bills by moving to a smaller home, we eat out often and take a couple vacations a year. No long term trips as wife is undergoing cancer treatments. We don't notice the reduced income as much as I expected, we buy what we need and most of what we want. I do spend more than my wife as my hobbies are expensive

[Jerry Bruette]

Wife and I are a little less than a year into retirement. So far costs haven't changed much. I do wish we had more in a Roth account though, it would give us a little more breathing room playing the ACA game.

[glenn bradley]

Beyond planned major expenses, we spend less but we are home bodies.

[roger wiegand]

I didn't have as much time to spend money before I retired; that said we're probably spending a bit less now. Basic expenses of mortgage and property taxes haven't changed, our house is now much more efficient so utilities have gone down. Our kids may finally finish their educations in the coming year, which will save some. We go out to eat less, but travel more on our own dime. (though that has been mostly on hiatus with covid). We spend a stupid amount on telephones and internet. For the first time I've started having to hire people to do maintenance tasks; DW won't let me go up ladders taller than my 8 ft step ladder anymore, for example, so we're paying gutter cleaners. The house will need painting in a couple of years, that would always have been a DIY task in the past, now it will probably be a $20K bill to pay. I'm guessing our expenses will continue to rise as we need to buy more services. We pay for a somewhat pricey medicare supplemental plan and have, so far, have had little out of pocket medical expenses beyond that premium despite a couple of major episodes.

[Jim Becker]

A few expenses won't change due to retirement, property taxes, utilities, insurance. But if you aren't old enough for Medicare, this can be a budget breaker.

I agree with this. A primary reason I was able to retire at age 60 is because Professor Dr. SWMBO's employment provides our health/dental/vision insurance and that continues until she retires at the end of this academic year. If I had to pay for insurance on the open market, retirement at 60 wouldn't have been a "good deal". While I'm currently eligible for Medicare, I'm still on The Professor's insurance so I only have Part A and don't have to pay the premium from my SS. Yet. Next summer, a decision will have to be made about how each of us cover ourselves for health care. The Professor will necessarily have to either use and pay for her available retirement coverage (same coverage as now but fully out of pocket for premiums) or use a plan off the market for a a year until she's eligible for Medicare. (She is retiring for medical reasons that I'll not go into here) I will likely fully embrace Medicare at that point next summer for my own coverage and there are bunch of decisions around that that come into play.