The Best Retirement Spending Advice From Our Readers

As for the “rules” for budgeting in retirement, I set aside $100,000 for what I call a “What Happens” account. It was designed to get me through five years of unexpected and one-time expenses. My friends have adopted the same approach.

Obviously your friends know a good idea when they hear one.

Those comments, from Roger Bretting, a Houston retiree, were among the many we received in response to my recent column on what I call the “400 dollar rule.” la,” a household budgeting method I adopted in my retirement. The rule says that the average retired couple will spend $400 a month more than they expected. This proved to be true in my case. In my column, I invited readers — retired or soon to be — to share with me any rules, recommendations, or strategies they’ve developed or adopted to regulate their spending habits. and their own savings.

My thanks to everyone who took the time to write. Here are some of the most helpful comments we received — starting with a warning.

Plan to be surprised

Interestingly, almost every reader asked me to warn those about to retire: Your spending in retirement will likely equal or exceed what you are spending while working. To put it another way: Take the common sense of needing 70% to 80% of your income up front to maintain your standard of living in later life and walk away.

“My wife and I spend 50% more in retirement than we do working,” says Bob Bailey, 77, a retired advertising executive in Evanston, Ill. First, we have time for travel, especially international travel. Second, we volunteered in our community and discovered many needs; As such, our philanthropy has expanded considerably. ”

Spending in retirement

Average annual household spending by age, among partially and fully* retired households with $1 million to $3 million in investable assets:

Kevin Baughman, 68, a retired pharmaceutical executive in Santa Rosa, California, adds: “I can’t see how I can spend less in retirement, because I have a lot of time. more free. So I was targeting 90%. When I was about to retire, I switched it to 100%. My reality turned out to be close to 110%”.

One exception to this thought among the comments we received: a retired couple in a small town in Alabama. Their strategy:

“We expected the cost of living here to be lower than in a third tier city. However, we do not expect it to be significantly lower. We live better than we do in the city, in a nicer house, engaging in more activities and spending less. We would advise anyone planning to retire to consider moving to a small town for both quality of life and financial reasons. ”

Continue budgeting

If you’re budgeting for retirement — great. But some readers told us: This is not, or shouldn’t be, a one-off exercise. It’s important to refine your budget every year, they say.

“My wife and I consciously research ways to ‘reduce costs’ every year,” writes HL Singer, 76, a retired executive in Melbourne, Fla. Among their steps, small and big: review and change (or simply cancel) streaming services and magazine/newspaper subscriptions; book travel a year in advance; edit more meals at home; better use of programmable thermostats; Research purchases and then wait for sales and coupons.

“We’ve found that by constantly looking for ways to cut costs and shop smart, we can do a better job of adding to our retirement savings and pensions,” said Mr. ”

Leave room in the budget

In my previous column, I laid out my personal retirement rule: Calculate a household budget for the year — and then add $5,000 (about $400 a month) to non-essential bills. valid. That total should be close to the income you actually need. Some readers told me my math won’t work for all regions of the country (read: high cost areas) and offered a better solution: just add 10% to any whichever budget you produce first.

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Michael Arvanetakis, 69, of Cypress, Texas, writes: “It seems almost every month that there is an ‘unusual’ expense that blows up the budget. “My wife and I have had this all our lives. Our rule is to add 10% to your budget — always.”

Ronald Londe, 76, a retired energy analyst in St. Louis, also made a similar point. His rule: “In December of each year, I make an estimated family budget for the coming year. On top of projected spending, I add 5% for inflation and 10% for unspecified events. Then I adjusted my income ‘pool’ — mainly dividend-quality stocks — to generate the required annual cash. ”

Start an account on a rainy day

Another way to handle the unexpected: rainy day money. Mr. Bretting, at the top of this column, is one of a number of retirees who say they’re conspicuously saving money to cover unforeseen bills early in retirement, when the nests are vulnerable. best. The account “Stuff Happens” is a “spiritual salvation,” he wrote.

“In the two-and-a-half years that I’ve retired, I’ve paid $8,500 for freezer damage; $3,500 for my spouse’s dental problems (no dental insurance); $25,000 for my youngest needing an extra semester of college to graduate; $1,500 for two cell phone drowning accidents; and $5,000 in flood damage to our sprinkler systems and landscaping. ”

He concluded: “I sleep better at night knowing that there is still some money left for the next ‘Stuff Happens’ event.”

Fluffy and Fido? Maybe not


Bruce Woods, a retiree in Seneca, SC, has more than a dozen financial strategies for retirement, but one rule emerges:

“If you have pets, don’t replace them,” he said. “My wife and I travel a lot more in retirement, and the bills for crib care are over $1,000 a year. Get their pictures out and enjoy the fur-free furniture. You won’t miss constantly picking up and cleaning up after them. “

Ruffenach is a former reporter and editor for The Wall Street Journal. Ask Encore looks at finances for people thinking, planning, and living in retirement. Send questions and comments to

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