No. of Recommendations: 2
A huge portion of the Retirement planning/planners are based on various rules - retirement spending is x% of pre-retirement, withdraw Y% from your portfolio, you should have a percentage of bonds equal to your age -- and the list goes on.

Clearly these rules have some basis or else they would have disappeared with the Flat Earth Society. But I really think apply these rules needs be at the end of a process, not at the start.

The first thing a person facing (planned or otherwise) not working needs to know is what am I spending money on. There are some expenses that not uniform from month to month - say property insurance. Some are seasonal - heating/cooling costs. Some are pretty hard to change - medical insurance as an example. Some can be adjusted (food expense). Some will end (savings for retirement). If you don't know how much these expenses are, you can't possibly know what your retirement spending will be at your current standard if living in retirement.

I am a strong believer in Quicken - but other products exist. In my view it takes certainly over a year of data to estimate spending. How much does your insurance premiums change from year to year? What is the rate of return on your current portfolio - damn few people can ever retire without some portfolio income during retirement. Too many people (in my view) feel they cannot invest in stocks - they want CDs or bonds. Well after they pay taxes on the income from these conservative investments do they have even enough left over to cover inflation?

These are just some of the questions that you can answer with a few years worth of financial data - if you want.

Just a reminder -- at age 55 if you are an average American male you have and a life expectancy of 25 years. Female almost 29 years. That means half the 55 year old women will live beyond age 84 - some a lot longer. My wife and I both retired at age 55 and we are planning our financial future on the assumption my wife who is younger will live to at least age 95. A lot of things can change in 40 years.
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