When it comes to retirement spending, a recent survey conducted by GOBankingRates indicates that many Americans plan to spend $2000 a month.
But is that enough? Can 60% of Americans live on $2000 month in retirement spending? In the study, 29% indicated they were planning to spend $1500 a month and 29% also planned to spend between $1500-2000 a month.
So, is this realistic?
This is, in a nutshell, a very frugal retirement – especially with the cost of everything increasing in recent years. If this is the plan, retirees would have to have their home paid off and almost zero other debt – including a car payment or medical loans. Factoring in food, fuel, internet, utilities, insurance and taxes, this isn’t a lot of money to live on – leaving little room for travel, gifts, entertainment and unexpected emergencies.
However, it is possible to have a frugal retirement plan which can include moving to an area with a lower cost of living, not driving as much and cutting back on unnecessary purchases and expenses.
If you think this is a realistic goal, it’s a good idea to track your current spending habits and see where you are spending now – and what you might be able to cut in the future.
And you’ll need to try to guess where you might need to spend in the future – including health care costs.
It is always a good idea to talk about retirement spending with a professional, who can help you set realistic and attainable goals for your future. It’s never too late to start planning for a happy and healthy retirement.
Do you still have questions about retirement planning options?
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If you have other questions about retirement plan loans, email us or call 937.308.0758.
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