Home Forums Hunting & Shooting Hunter's Campfire Question for retirees

I'm a couple of years away from hanging it up for good, but I struggle with how to realistically estimate my "expenses" in retirement. We are totally debt-free and own our home and autos free and clear.

Categorically I have tried to divide our projected living expenses into monthly essential spending: (food, fire/vehicle/health insurance, utilities, public services, home upkeep, and giving.)

After that is discretionary spending: TV, internet, hunting/fishing trips, vacations, holiday spending, and grandmother mad money.)

When you were trying to put together a realistic budget before you retired, did you end up being too conservative, or not conservative enough (as far as projected monthly expenditures?) Also, what did you do to adjust?

Being, politically, financially and religiously conservative, our retirement was very much planned in advance, as was our earlier life.

We owned our home, free and clear, always bought new vehicles and paid cash for them and I owned a retail business that was very successful (no debt whatsoever.) Very boring to some, but that's the way Karen and I are.

About three years before we retired, we started setting up a graph of expenses; taxes, food, clothing, electricity, garbage, home maintenance, pocket money, a new vehicle ever few years and such ... over a couple of months, we couldn't believe how many divisions there were. In about a year, it became obvious that there was the another element ... the absolutely, unexpected expense that would raise its ugly head (a plumbing job, new electric box ... stuff like that).

Anyway, after three years, we had a decent handle on what our YEARLY expenses. Then, we added 20% for every year in the future.

We retired fully at ages 48/49. We are now ages 72/73.

True, we've had a fabulous bull market and I've done a competent job of managing our stock portfolio, but our original graph, plus the 20% added every year has done us well. Also, the home we bought 52 years ago is still very adequate for us.

Over those years, we've managed to hunt our butts off across the western states and Canada, plus two long African safaris.

Our plan was generous enough that it allowed me to donate all of the money I made in gun-writing to fund the Steve and Karen Timm Endowment Fund at our Catholic parish grade school ... quite literally, the gift God gave me in writing was "played forward" to pay for the education of children who could never, ever afford it. And that makes us feel very fulfilled in life.

It all takes planning and the will to be happy with your life that is kept within the bounds of your income.

Invest well, invest long, buy for long term and simply enjoy life to the max.

And don't wait too long to retire. After too many horse and elk rodeos, Karen's and my bodies are pretty busted up.

Best of luck with your plan ... it can be done and quite successfully.

God Bless,

Steve

If you thought waiting on payday was long before...

Work as long as you still enjoy it/your body tolerates it. Being retired for thirty years is entirely possible. Talk to your money guy about his Social Security worksheet. Starting too early cuts potential money recouped to about half.

2 cents

Essential spending, add 15% for repairs and other surprises.

Discretionary spending, double it then add 50%. Being retired is more fun than you can imagine. Our last 4 day excursion took 9 days. You must have a 4wd vehicle so you never have to pass up a dirt road that may lead to something interesting.


mike r

While you are working, assuming a 9-10 hour day counting commute, during those hours you are earning $s.

After you retire that 9-10 hours will be filled with something, and it will likely COST.

Do not forget to factor in the additional 'play' time.....

It's okay to start planning in your twenties and thirties.

Pay your bills, buy the essentials and the play with 60% of what is left. Keep the other 40% for the sheit that always happens when you least expect it.

My wife and I retired at 65/64 from owning restaurants. Prior to that she was a teacher and had an excellent retirement plan. We also have everything paid in full. We found that without changing our lifestyle at all, we use about 75% of what we did before retirement. The one bit of advice I would give is to make sure you are really ready to retire. The first six months were great...then, even with travel, parties and projects...you will have a lot of time to fill. As agazain said, work as long as you still enjoy it. It sounds like you have your finances well planned. Time will be the variable. Too much of it, rather than too little.

You didn't mention where your income will come from. One thing not on your list is taxes - of all stripes.

I used Fidelity's (and others offer the same I am sure) modeling tool five years before I thought I would retire. It was quite detailed with expense breakdown. I retired two years sooner than planned at 53. The only debt I have is on my primary residence (2% money is cheap to invest), owning the properties in Idaho, automobiles, etc. I am fortunate in that I have a pretty healthy pension coming each month and my health care is pretty reasonable ($400/mo for a family). I also do have two boys in college. As such we do take a couple of thousand a month to cover these costs. We just this week withdrew out first chunk for planned upcoming travel. My net worth is significantly higher now than when I retired. Bottom line, it has been fine for us. Do keep in mind that when you hit 70 or so your discretionary spending will likely fall a bunch.

I retired this past April at age 66 + 2 mo.. I waited until 66 so I could keep med. & dental on me & the wife a bit longer and I now get over 400 bucks a month more from S.S. than if I would have retired at 62. Also have a pension from a former employer that kicked in at 62. I've known my financial advisor for many years and she's been invaluable to me because I know nothing about these matters. She told me I could quit last Nov. but my employer offered a 2 day a week part time gig so I did that until this past April. We don't have any big debts and my wife would be financially good even without me. But I feel that having someone who really knows the retirement financial game is key, along with starting to prepare for retirement early. About the only financial thing that we didn't factor into the planning was that I now spend a lot more time in gun shops or shows than I used to and you know what can happen with that.

Excellent point. I am on my second read of a very good book entitled "The New Rules of Retirement Second Edition" by Robert C. Carlson. He elaborately goes through all the taxes a retiree faces. I had no idea. He is the one that recommends reading the "Family Bank Strategy" that I was discussing in the thread about Term Insurance. It helps solve some of those extortionary tax issues.

We spoke with a retirement counselor. Best 1200.00 we could have spent. At 49 and still two kids in college I was worried
to say the least. Been retired for 2 years now and no regrets..

It will take as much as it is now plus money to spend since your aren't going to be working.

I would make sure that State where you are going to live in retirement has a tax burden (property tax, sales tax, and income tax) that is reasonable.

The only mistake I made in my financial planning was in interest rates paid on CDs. I missed the drop they took in 2000 or so by a bunch.

The stock market tanked in 2000 to some degree, recovered and tanked again, and then took off. You can't predict the market well as most all of the stock analysts missed it too. You need to have a well balance portfolio that changes as you age and reflects your risk tolerance for the years you have remaining.

I would also add, as others have noted, it helps a great deal to have no debt and to avoid it as you go along.

After a few months of retirement I found myself asking "how did I have time to work?". 18 years later it is still a valid question.

Does anyone have a guaranteed annuity to take care of your essential bills? Alot of my friends and neighbors have some annuities.

I didn't have a choice. Vertigo and heavy haul truck driving are not compatible. I retired at 62 on SS alone. We are still alive, still having fun, and still loving retirement.

That is encouraging news Scott.

Retired at 57 with no planning whatsoever. Just had enough and said, this is it. Eleven years later....no regrets. Life is good.

Every day is a Saturday when you retire.

Almost, we have six Saturdays and one Sunday a week.

While I totally agree ….maybe maybe not. For yourself I agree. But it's the unknown like sick relatives or kids coming back to roost that can make a huge change in this!

Thank God my 49 year old sister was a tenured teacher with a Masters and had the required years to receive excellent full health at full costed retirement rates. Otherwise, I could have been wiped out. That very large stage IV cancer experience that was very expensive even with great insurance was very educational. And it's not over yet. However, I would spend every dime I have to care for any one of my relatives. And likely will leaving me in a van down by the river.

The unknown sucks. But the unexpected diagnosis is much more painful than the price tag and portfolio repercussions. NO comparison. I never cried over lost investments, but I have cried.

Decent health insurance for all is key!! No mortgage is the other. Responsible siblings and kids very important.

When you retire you will suddenly have time to work on all those dozens of projects that you always wanted to do, but didn't have time for. Plus, your wife will suddenly present you with a list of projects that she thinks you now have time for.

The problem is, all those projects cost money. Lumber and hardware adds up fast. Everything seems to cost twice as much as you remembered it costing.

Many of my friends had the same experience; living being retired can easily cost more than it did when you were working. And before you know it, you will be on a first-name basis with several of the employees at Lowes and Ace Hardware.

Lastly, do what you can while you can. Health is a fragile thing.

My boys are/will be well set. My siblings the same. Thankful to the great parenting we had.

Glad to hear.

We had and still HAVE excellent parenting as well. The best ever. But that does not prevent the unexpected that just happens and always seems to cross borders to cost the more fortunate of the TOTAL family. These days the more fortunate become the providers as someone always comes up short. I realized this when I started writing checks to keep a few alive.

I wish the best for you and hope your current good fortune continues. Time will tell. For all of us.

Typically, I found you will need about 75% of your working income when you retire.

Suspecting that everyone has different metrics to evaluate when they retire, take stock and make the call. I had three mortgages at the time, previously refied to get the nut downsized and all that. Biggest expense pre-bailout was travel and meals....punching out was a boost to disposable income for me, even with a 50% pay cut.

Woke up one day, went to work on a day shift...yakked at planes for a spell and took a coffee break. They started paging me....I said BS and handed in my badge. Went back into the control room to say farewell to a few and the sup started giving me a ration of chitt. Told him he was confused and that I didn't work there. Got a lot of applause for that stunt, left with a smile on my mug. The air traffic bidness has a finite shelf life.

YMMV

My annuity is called Teacher Retirement. I will pay in 225,000, be able to get 70,000 as long as wife and I live. Bad thing is if we both get killed in a wreck the day after I retire the kids won't get a dime. Teacher retirement is one of the better deals out there, depending on how long you live.

Planning!?! We don't need no stinking planning.

Got offered a chunk of cash to go early at 58, with 40 years of service. That lump, combined with my pension, carried me right up to early Social Security. So far, so good, and I'm not debt-free. My lifestyle isn't fancy, however, and I live where electricity is cheap. Don't travel either.

When the offer was made, I told my wife, "I don't know if we can afford it, but we're going to find out!"

Okie:

My wife and I both retired early and lived entirely off of our pensions for ten years before applying for Medicare and Social Security. During that time we practiced living on a limited income. We have no debt and were financially independent even before we started sucking on the federal tit. I track our monthly essential expenses and our monthly income. The difference can be used for discretionary spending. It's not any more complicated than that.

My wife and I are both habitually thrifty. We are certainly not wealthy but we have a "comfortable" discretionary income each month, less in January when we have to pay property taxes on two homes.

KC

If you are smart it is mandatory. I'm glad my Parents made me start an IRA and manage it as an investment when I was 18.

I'm in trouble then. I won't even have 50%.

I should have 80%

That is a common metric but it really depends upon how much of your working income was spent.

Being debt free, you are already ahead in your planning. I and a couple of my friends who talk about such things probably over-estimated our discretionary retirement expenses. If you're not an extravagant type, it's easy to adjust discretionary spending.

Since you're a couple of years away from retiring, you may want to consider what I did. I retired at age 55; I'm now 66. We live on a pension and social security. I got a retirement income estimate from my company's retirement system (which turned out to be very accurate). About 1.5 years before retirement I adjusted my take-home pay (by adjusting credit union withholding)down to what my retirement take-home would be. After living on essentially retirement income for that long without adjusting our lifestyle, there was no stress about how we would do in retirement. When we started drawing social security, it more than covered any increased costs, either fixed or discretionary, with money left over.

That is a good idea. Thanks