# How much money do I need per month in retirement? (long) **URL:** \ **Category:** In My Humble Opinion\ **Created:** [January 19, 2020, 4:23am UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650 "2020-01-19T04:23:28Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Wesley\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wesley_clark/32/20581_2.png) [@Wesley\_Clark](https://boards.straightdope.com/u/Wesley_Clark)\ **Post date:** [January 19, 2020, 6:27pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/21 "2020-01-19T18:27:53Z")
> [@madmonk28](#): > > I know we have questions like this a lot, but those are usually along the lines of how much should I be saving for retirement. What I’d like to do, is describe the lifestyle I would like to maintain and then ask the teeming millions to help me figure out how much I need every month. Obviously, more money is better than less money, but I don’t want to work and save until I drop dead at my desk. I’d rather this discussion focus on what we’ll need and not on what we’ve saved. > > **Our plan for retirement** : we will leave Washington DC to retire around Bristol, TN. We are both avid fly fishers and the Bristol area has two great rivers with wild trout (the Watauga and the South Holston) as well as several smaller mountain streams. It also has much more temperate weather than other fly-fishing destinations like Montana. We don’t anticipate doing a lot of travel (although some) because we will be retiring to the place that we travel to most often now for vacation. > > **Housing:** we will either sell or rent out our DC house. We bought it over 15 years ago and it has appreciated nicely. We will also sell a small mountain cabin we have in VA. As a result, we will be able to pay cash for a small house that meets our needs and won’t have a mortgage (or have a very small one that our rent in DC would cover). > > **Lifestyle** : go out to eat a couple of times a month, but mostly read, fish, cook at home, and bitch about the government. We have no dependents. About 6 times a year, we would hire a guide we know and do an all-day fishing trip in his boat. These cost about $600, so figure $3,600 per year. The rest of the time, it’ll just be us wade fishing with gear we already own (we both own enough gear to open a fly shop). > > **Health insurance:** assuming we wait until we qualify for Medicare, then we would still need some supplemental insurance. To be honest, if it wasn’t for health insurance costs, I would semi-retire now and work as a consultant, but alas. > > Given that my life ambitions are so unambitious, what would do you reckon our monthly living expenses would be? Median home price in Bristol is only about 130k, so its a low cost of living town. According to [this](https://www.aarp.org/health/medicare-insurance/info-2018/medicare-social-security-check-fd.html)the average medicare recipient will spend about $700/month on premiums and care not covered by medicare by 2030. So thats minimum 1400/month for medical care for you both. You’d probably want long term care insurance too, so that’s probably an additional 500/month for both of you. Which would mean medical care alone was about 2k. All your other expenses combined will probably come to less than 2k if you have a paid off home. You’d probably spend ~300 on various utilities, another few hundred on household issues other than the mortgage, a few hundred a month on transportation expenses, maybe 500/month on food, 300-500/month on entertainment and vacations including fly fishing trips, etc. ---
**Author:** ![madmonk28](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/madmonk28/32/20811_2.png) [@madmonk28](https://boards.straightdope.com/u/madmonk28)\ **Post date:** [January 19, 2020, 6:29pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/22 "2020-01-19T18:29:05Z")
> [@jasg](#): > > Ten years retired here. > > I found it helpful to keep a simple monthly spreadsheet of about fifteen line items to track fixed vs other expenses. I started just before retirement and have kept it going for ten years, it shows me how things change. I do not track to the penny. Just fairly broad categories; Utilities, Home Maintenance, Insurance & Real Estate taxes, Medical, Food, Auto expenses, Entertainment & Travel. We each assume we have an ‘allowance’ for spending money. If things were to get tight, we will cut back on the last three categories. > > Housing and Medical costs have been a real eye opener. Seattle housing is booming here along with taxes and Medicare (plus MediGap & PartD) has increased faster than my Social Security. A surprise about Medicare was that there is no out of pocket max unless you get additional coverage. I did so to give me an upper limit. > > Not just hard to get a mortgage, renewing a line of credit took a lot of effort. We use it just to smooth out big expenses without extra withdrawals & tax hit from retirement accounts. > > As an answer to the original question, our spending is a bit more than the median income in our (high tech and high cost of living) area - while not living an extravagant lifestyle, we don’t feel pinched. Housing costs will be the big difference between here & Bristol. Thanks this is helpful. For us, housing won’t be an issue. We’ve been kind of pricing houses and are shocked at how affordable it is compared to DC. Medicare is the expense that I’m just starting to try get my head around, I’m 53 and my wife is 49, so it will be a while before we qualify. I just wish the state if health insurance in the next few years was at all predictable, it makes planning difficult. ---
**Author:** ![Bill\_Door](https://avatars.discourse-cdn.com/v4/letter/b/50afbb/32.png) [@Bill\_Door](https://boards.straightdope.com/u/Bill_Door)\ **Post date:** [January 19, 2020, 7:33pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/23 "2020-01-19T19:33:27Z")
> [@Wesley\_Clark](#): > > (snip)According to [this](https://www.aarp.org/health/medicare-insurance/info-2018/medicare-social-security-check-fd.html)the average medicare recipient will spend about $700/month on premiums and care not covered by medicare by 2030. So thats minimum 1400/month for medical care for you both. You’d probably want long term care insurance too, so that’s probably an additional 500/month for both of you. Which would mean medical care alone was about 2k.(snip) I looked at that link. The first thing you need to realize is that AARP is heavily funded by sales and royalties: [QUOTE=Palm Beach Post] Senior advocacy organization AARP receives $762.6 million a year — more than half its total revenue of $1.3 billion — from royalties on everything from health and car insurance deals to credit cards, records reviewed by The Palm Beach Post show. [/QUOTE] Secondly, an average cost doesn’t necessarily reflect your cost. Just like most things, medical costs are subject to a pareto rule, 80% of the spending will be done by 20% of the medicare recipients. You’re going to be the best judge of what you’re likely spend on medical care. My monthly Medicare premiums are $144.60, and I pay another $79 for my Humana Medicare Advantage plan. I don’t spend more than a few hundred dollars in uncovered expenses over the course of a year. My wife and I, both in our late sixties, don’t have more than $600 a month in medical expenses adding everything together, premiums, copays, deductibles, the works. Taking an insurance company’s advice about how much you’ll be spending on medical care is not fiscally reasonable. ---
**Author:** ![P-man](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/p-man/32/3606_2.png) [@P-man](https://boards.straightdope.com/u/P-man)\ **Post date:** [January 19, 2020, 7:35pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/24 "2020-01-19T19:35:07Z")
I grew up in Bristol, and it is indeed affordable and in a beautiful part of the country. The fishing is great (trout as well as smallmouth bass). We could pay off what little is left on our mortgage and have a ton of money left over (we are a few miles up the road from you in Silver Spring). If you can deal with the very conservative politics of the majority, you’ll probably like it fine. It would be too much for us; it’s a big reason I left in my twenties. Surprisingly, there’s a big craft beer scene in downtown Bristol. Health insurance will be the big thing for me if I want to retire in 5 years. A lot could change, for good or bad, in that time. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [January 19, 2020, 7:40pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/25 "2020-01-19T19:40:53Z")
Just before I retired we looked at our checkbook and credit card bills. We decided we needed about $80K a year to live on, my income was a lot higher, so I wanted to figure out how I was spending the difference and what needed to be cut. Turns out it was all savings and income taxes. I retired and my savings haven’t gone down much in 4 years, except for taking out money to pay off the mortgage. The important thing to look at is cash flow. How much will your savings be generating when you retire? How much is pretax and how much is post tax. By taking out pretax money in reasonable amounts, you can minimize taxes on it. You can move money to income producing investments away from all long term growth investments. With luck, and if you have enough, you can live on income and Social Security without touching principal except for major unexpected expenses. (Like a new roof or something.) Figure out how long you need to be investing to get there. Sounds like you must be saving already, though. Remember also that it is okay to spend more on fun right after you retire since in 20 years you won’t be as interested in having fun. My financial planner ran a Monte Carlo simulation that showed the probability we would have a certain amount of money left up until 94 or something. That’s about the best retirement planning tool I’ve seen, since assuming the market grows a certain amount isn’t really adequate for planning. ---
**Author:** ![Wesley\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wesley_clark/32/20581_2.png) [@Wesley\_Clark](https://boards.straightdope.com/u/Wesley_Clark)\ **Post date:** [January 19, 2020, 7:43pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/26 "2020-01-19T19:43:33Z")
> [@Bill\_Door](#): > > I looked at that link. The first thing you need to realize is that AARP is heavily funded by sales and royalties: > Secondly, an average cost doesn’t necessarily reflect your cost. Just like most things, medical costs are subject to a pareto rule, 80% of the spending will be done by 20% of the medicare recipients. You’re going to be the best judge of what you’re likely spend on medical care. My monthly Medicare premiums are $144.60, and I pay another $79 for my Humana Medicare Advantage plan. I don’t spend more than a few hundred dollars in uncovered expenses over the course of a year. My wife and I, both in our late sixties, don’t have more than $600 a month in medical expenses adding everything together, premiums, copays, deductibles, the works. > > Taking an insurance company’s advice about how much you’ll be spending on medical care is not fiscally reasonable. The Kaiser family foundation did that study though, AARP just reported it. > **[Medicare Beneficiaries’ Out-of-Pocket Health Care Spending as a Share of...](https://www.kff.org/report-section/medicare-beneficiaries-out-of-pocket-health-care-spending-as-a-share-of-income-now-and-projections-for-the-future-report/)** > > Introduction Medicare helps pay for the health care needs of 59 million people ages 65 and over and younger people living with permanent disabilities. Yet, people with Medicare can face significant health-related out-of-pocket costs, including... As an example: Medicare A premium - 144 Medigap (low deductible plan) premium - 150 Medicare D premium - 40 So from those 3 alone, thats over $300 a month. Then you have all the other deductibles and copays. Then you have all the care not covered by medicare like chiropractic, hearing aids, vision, dental, etc. Right now its about $500-600/month per person but will be closer to $800/month per person by 2030. And again, that still doesn’t include long term care which is extremely expensive. Also in your late 60s, you aren’t really that expensive to the medicare system yet. When you are 80+ your medical costs will likely be higher. ---
**Author:** ![Corry\_El](https://avatars.discourse-cdn.com/v4/letter/c/ecae2f/32.png) [@Corry\_El](https://boards.straightdope.com/u/Corry_El)\ **Post date:** [January 19, 2020, 8:13pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/27 "2020-01-19T20:13:32Z")
> [@Wesley\_Clark](#): > > The Kaiser family foundation did that study though, AARP just reported it. > > 1. As an example: > Medicare A premium - 144 > Medigap (low deductible plan) premium - 150 > Medicare D premium - 40 > > 2. So from those 3 alone, thats over $300 a month. Then you have all the other deductibles and copays. Then you have all the care not covered by medicare like chiropractic, hearing aids, vision, dental, etc. Right now its about $500-600/month per person but will be closer to $800/month per person by 2030. > > 3. And again, that still doesn’t include long term care which is extremely expensive. > > 4. Also in your late 60s, you aren’t really that expensive to the medicare system yet. When you are 80+ your medical costs will likely be higher. I don’t question the accuracy of the numbers just because AARP gets revenue in marketing tie ins with ins co’s. But to comment further 1. Bill Door can comment further on own situation but the combination he mentioned, Part B premium (actually it is) ~$145 plus Medicare Advantage ~$80 is a different way of covering all three categories in your numbers, and then there isn’t necessarily that much in the way of copay/deductibles. And MA plans also often include stuff like vision and dental to some degree. They have other potential drawbacks like narrower and/or local only\* networks of providers, and the pricing depends where you live. It’s a complicated topic I’m beginning to get into because it’s coming up in not too many years. It can vary quite a bit. 2. True, neither the study nor the back and forth on Medicare includes that, but it’s something one arguably must have, and is expensive. 3. That’s very true from current taxpayers’ POV of the cost of govt supplied medical care for very old people. It’s not necessarily as true that those people get socked with huge out of pocket cost, depending how they have arranged things under point 2. \*which partly defeats the advantage of reaching Medicare age and thus being able to get non-emergency healthcare anywhere in the US, if frequently travelling or different summer and winter homes. ---
**Author:** ![Wesley\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wesley_clark/32/20581_2.png) [@Wesley\_Clark](https://boards.straightdope.com/u/Wesley_Clark)\ **Post date:** [January 19, 2020, 8:48pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/28 "2020-01-19T20:48:07Z")
I hope I’m wrong and that medical costs aren’t that bad. I know for me, I won’t retire until the 2040s and I’m estimating I’ll need about $1000/month inflation adjusted just for my own health care needs. I’d rather overestimate and leave an inheritance than under estimate and have to work at walmart. Thats almost as much as I’d spend on all other bills combined assuming I own my own small home, have solar power and an electric car (I budget about $1000-1500 for all other living expenses if I have those set up). If people can make the medicare system work for them for $300/month total in premiums, copays, deductibles and uncovered medical care then that is great. But according to that Kaiser study, for people over age 85 (especially women), about 70-85% of their entire social security check goes to medical care not covered by the medicare system. For younger people in their 60s and 70s its closer to 40% though. I’m hoping that as people (including the elderly on medicare) get crushed by medical costs, that something is done to change it. Maybe legislation to cover long term care in medicare as well as limitations on total medical spending as a % of gross income in retirement (maybe all medical spending will be capped at 10-20% of gross income for those on medicare, not sure). ---
**Author:** ![madmonk28](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/madmonk28/32/20811_2.png) [@madmonk28](https://boards.straightdope.com/u/madmonk28)\ **Post date:** [January 20, 2020, 3:52am UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/29 "2020-01-20T03:52:51Z")
> [@P-man](#): > > I grew up in Bristol, and it is indeed affordable and in a beautiful part of the country. The fishing is great (trout as well as smallmouth bass). We could pay off what little is left on our mortgage and have a ton of money left over (we are a few miles up the road from you in Silver Spring). > > If you can deal with the very conservative politics of the majority, you’ll probably like it fine. It would be too much for us; it’s a big reason I left in my twenties. Surprisingly, there’s a big craft beer scene in downtown Bristol. > > Health insurance will be the big thing for me if I want to retire in 5 years. A lot could change, for good or bad, in that time. Thanks, I’m very familiar with the Bristol area, we go there 5-6 times a year. Our goal is to get a small house on the banks of the South Holston or the Watauga. Our ideal house would be around Bluff City on a small wooded lot. We have friends down there and the politics of the region don’t matter because I doubt I’ll say two words to anyone who is not a trout. Plus, I’ll do anything to get away from Maryland drivers :). I use my credit card the same way that others here do, I use it for every purchase and pay it off at the end of the month. With retirement, I keep thinking that there must be some expense I’m not thinking of. That I’m going to retire and the next day realize, “shit, I didn’t budget for x.” So far x is health insurance. Our current plan is to rent out our house in DC when we leave the city. That way, we’d have a steady income and we can always sell it at a later date if we needed the cash. ---
**Author:** ![jasg](https://avatars.discourse-cdn.com/v4/letter/j/f0a364/32.png) [@jasg](https://boards.straightdope.com/u/jasg)\ **Post date:** [January 20, 2020, 4:03am UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/30 "2020-01-20T04:03:43Z")
> [@Wesley\_Clark](#): > > I hope I’m wrong and that medical costs aren’t that bad. We are both in good health but last year, Medicare insurance premiums were 16% of our ‘fixed’ expenses, Utilities (including cell & internet) were 18%. ---
**Author:** ![Mama\_Zappa](https://avatars.discourse-cdn.com/v4/letter/m/71e660/32.png) [@Mama\_Zappa](https://boards.straightdope.com/u/Mama_Zappa)\ **Post date:** [January 20, 2020, 4:07am UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/31 "2020-01-20T04:07:43Z")
You can look at Medigap costs for your current area and your proposed area. We’re 5 years away (at least) but our in-laws live in southern Florida - so a couple years back, I looked up the costs for our current area and theirs. It was shockingly more expensive down there than where we are (Northern VA). I don’t know for sure, but I suspect that at least part of that would be because their area is, as my SIL says, “God’s Waiting Room” - i.e. a substantial population of the area is retirees. Housing will be cheaper almost anywhere in the country compared with DC (with the exception of, say, NY / Boston / coastal California). Me, I’d suggest you expect to spend as much as you do now (net of retirement savings). Some of your income will increase - Social Security does increase according to inflation; the work-related expenses will decrease but health will likely increase. Since your housing will be cheaper, that should offset those expenses that increase. Don’t forget to factor in any expenses related to managing your house in the DC area. There will be times where repairs etc. exceed the income, and if you sell it there may be renovations needed before it sells. ---
**Author:** ![PastTense](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pasttense/32/14550_2.png) [@PastTense](https://boards.straightdope.com/u/PastTense)\ **Post date:** [January 20, 2020, 4:34am UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/32 "2020-01-20T04:34:53Z")
> [@madmonk28](#): > > With retirement, I keep thinking that there must be some expense I’m not thinking of. That I’m going to retire and the next day realize, “shit, I didn’t budget for x.” So far x is health insurance. . But health insurance doesn’t cover a major part of the problem: that with health problems you can become seriously disabled. So you need people to come and do all kinds of things for you that you used to do yourself. Or you need to go to a nursing home. PS: When buying a house make sure it is one story and can easily become handicapped-accessible. ---
**Author:** ![Bill\_Door](https://avatars.discourse-cdn.com/v4/letter/b/50afbb/32.png) [@Bill\_Door](https://boards.straightdope.com/u/Bill_Door)\ **Post date:** [January 20, 2020, 1:00pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/33 "2020-01-20T13:00:14Z")
I probably pay a good deal less than most people for medical coverage for several reasons. I have a philosophy that insurance is meant to protect me from costs that I can’t afford, not those that I can. I don’t even consider what the deductibles are, I just look at the maximum out of pocket expense. With my Medicare Advantage policy, even out of network, my individual maximum out of pocket expense is only $10,000. I wouldn’t laugh at a ten thousand dollar bill, but I wouldn’t lose any sleep over it either, so I don’t spend a lot of money on a plan that lower the co-pays and deductibles between my policy and the maximum out of pocket. I’m also not a guy that needs your fancy-schmancy brand name drugs. If I get a prescription from a physician, my first question is always how much is it going to cost, and if it’s too expensive, I try to get a cheaper alternative. Sometimes doctors will push the latest thing for what I consider specious reasons, like convenience. Just because the patented newest drug is once a day instead a three times doesn’t make it worth an extra fifty or sixty dollars to me. And I try to take care of myself. I walk 100,000 steps a week and go to the gym a little more than two times a week. Every Tuesday and Thursday I have my Silver Sneakers classes and I do a strength circuit on the weight machines afterwards, with an occasional Sunday morning trip if the grandchildren aren’t around. I know what I’m eating and why. Too many people expect medicine to take care of what are primarily lifestyle diseases. Plus, my Medicare Advantage plan gives me money for taking care of myself. Go to the gym more than eight days in a month, get five dollars. Do your annual wellness visit, that’s twenty-five dollars. Flu shot? That’s a fifteen dollar credit. It seems crazy that someone who wouldn’t work out for their health might do it to get a $5.00 Amazon gift card, but there you have it. ---
**Author:** ![Kent\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kent_clark/32/105_2.png) [@Kent\_Clark](https://boards.straightdope.com/u/Kent_Clark)\ **Post date:** [January 20, 2020, 6:05pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/34 "2020-01-20T18:05:22Z")
The first thing I’d suggest is “don’t retire until you both can get Medicare.” Private insurance premiums for a 60+ person will cut through your savings quickly. As for everything else, there are some things you can cut, some you can’t. Your expenses for food, clothing, and utilities won’t really change, but you won’t be driving as much and may find out you don’t need two cars anymore. If you’re planning on any kind of travel other than driving, you’ll find your costs are going up. The Tri-Cities area isn’t a hotbed for competitive air fares, for instance. One thing I’ve found in retirement is that people who want to indulge their hobbies end up spending a LOT more on their hobbies than they did when they were working. You may think you’ll be spending $600 per trip and that you have all the gear you’ll ever need, but don’t be surprised if you want to expand those trips by a day or two (hey, you’re retired, it’s not like you need to get back home, right?) or find your old rods just aren’t good enough anymore. ---
**Author:** ![P-man](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/p-man/32/3606_2.png) [@P-man](https://boards.straightdope.com/u/P-man)\ **Post date:** [January 20, 2020, 6:11pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/35 "2020-01-20T18:11:14Z")
Ms. P and I stay at a place on Watauga Lake most summers. There are some people who have houses that are literally on the lake (on pontoons, I assume). The restaurant has a dock where people arrive by boat. We are thinking we’d like to retire near the water as well, but every time we see that damn giant Confederate flag on the hill next to my parents’ farm we wince. I hear the trout in the area are fairly moderate politically. A wooded lot in the Bluff City area sounds pleasant. I think Boone Lake has gotten a lot cleaner since they stopped dumping sewage into it. 🙂 ---
**Author:** ![Wesley\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wesley_clark/32/20581_2.png) [@Wesley\_Clark](https://boards.straightdope.com/u/Wesley_Clark)\ **Post date:** [January 20, 2020, 6:23pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/36 "2020-01-20T18:23:16Z")
> [@Kent\_Clark](#): > > The first thing I’d suggest is “don’t retire until you both can get Medicare.” Private insurance premiums for a 60+ person will cut through your savings quickly. If you can adjust your modified adjusted gross income so that it is \<400% of the federal poverty level you get subsidies that make your premiums at max 10% of your gross income. So if you dump a lot of money into 401ks, IRAs and HSAs to get your MAGI below that 400% mark, you can get a subsidized ACA plan. Granted, the plan will be crap. High deductible, narrow network, etc. ---
**Author:** ![peedin](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/peedin/32/14095_2.png) [@peedin](https://boards.straightdope.com/u/peedin)\ **Post date:** [January 20, 2020, 9:54pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/37 "2020-01-20T21:54:54Z")
I’ve never understood this question. How much money do you require now per month? That’s how much you’ll need per month when you retire, assuming you wait til you’re 65 and can get Medicare. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [January 20, 2020, 10:27pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/38 "2020-01-20T22:27:10Z")
> [@peedin](#): > > I’ve never understood this question. How much money do you require now per month? That’s how much you’ll need per month when you retire, assuming you wait til you’re 65 and can get Medicare. That’s often not true. The OP talked about downsizing and moving. When you retire, you don’t need to be near work anymore. You will cut down on commuting expenses. If you dress up for work, you’ll cut down on clothing expenses. If you used to eat lunch out, you can now eat leftovers. Our supermarkets have special sales on weekdays that we can take advantage of now. It all adds up. Someone who was working from home probably won’t see much of a savings, the rest of us can. ---
**Author:** ![Wesley\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wesley_clark/32/20581_2.png) [@Wesley\_Clark](https://boards.straightdope.com/u/Wesley_Clark)\ **Post date:** [January 20, 2020, 11:27pm UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/39 "2020-01-20T23:27:26Z")
> [@peedin](#): > > I’ve never understood this question. How much money do you require now per month? That’s how much you’ll need per month when you retire, assuming you wait til you’re 65 and can get Medicare. The issue is that your expenses in your early 30s are going to be totally different than the expenses in your 60s for example. In your early 30s you may have daycare costs for kids, mortgage payments, student loans, saving 10% of your gross income for retirement. When you retire ideally all those expenses will disappear. My younger brother spends over 5k a month on daycare, mortgage, retirement savings and student loans for him and his wife. When he is retired all those costs will disappear (assuming the house is paid off which it should be). Plus your tax rate is lower in retirement, I know an elderly couple I met in college who make 100k a year in gross income in retirement (they both have SS, plus pensions plus other investments), their total federal + state + local tax rate is less than 15%. If they were a working couple making that kind of money they’d have a tax rate closer to 25-30%. So if you’re making 100k as a working adult your net (after taxes and retirement savings) may be 60-65k a year. If you make 100k when retired your net income may be 85k a year. Plus as \*\*Voyager \*\*mentioned, you don’t commute as much or have nearly as many work related expenses. ---
**Author:** ![squeegee](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/squeegee/32/14537_2.png) [@squeegee](https://boards.straightdope.com/u/squeegee)\ **Post date:** [January 21, 2020, 1:17am UTC](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650/40 "2020-01-21T01:17:20Z")
> [@Wesley\_Clark](#): > > Plus your tax rate is lower in retirement, I know an elderly couple I met in college who make 100k a year in gross income in retirement (they both have SS, plus pensions plus other investments), their total federal + state + local tax rate is less than 15%. If they were a working couple making that kind of money they’d have a tax rate closer to 25-30%. So if you’re making 100k as a working adult your net (after taxes and retirement savings) may be 60-65k a year. If you make 100k when retired your net income may be 85k a year. Can you clarify this please? I know SS benefits are taxed, I assume a pension is as well. Investment income may be taxed long or short term of course (or be tax free in some cases). How do you get from 25-30% to 15%? Thanks. [Previous page](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650.md?page=1) [Next page](https://boards.straightdope.com/t/how-much-money-do-i-need-per-month-in-retirement-long/846650.md?page=3)