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When I started my retirement planning, I assumed I'd need 100% of my gross pay. As I got closer to retirement, that number seemed high so I dropped it down to around 75%, which of course means I didn't need as much as my first estimates. When I was 5 years away from retirement, I started using current expenses, less any that would disappear or be reduced once work was out of the picture, plus adding new retirement expenses (mainly health related). As a result, the percentage went down further, but I use 75% for planning purposes.

Since we have become retired we find our expenses have gone up, slightly. We now both have more leisure time. We travel more. We go to more movies (matinees, mostly). We entertain a bit more, and go to friends' houses for the same (bringing along a not-cheap-but-not-expensive bottle of wine). Health insurance has gone up, dramatically, obviously, since there is no employer.

And none of our other expenses have come down. We don't heat the house less, or feed the pets less, and Mrs. Goofy's volunteer activities mean she's driving more and contributing more to those causes than when she was just a "remote" supporter of them.

May be different for others, but for us expenses are up, not down. Income, obviously, is down, but what'cha gonna do?
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