Retirees

Many financial publications state that retirees should have the capability to live on about 80% of their pre-retirement income.  However, in spite of the fact that medical costs will surely increase during retirement years, many other expenses incurred during your working years will be dimensioned and/or eliminated in the retirement years.  The list below are just a few of the expense items that will be or should be reduced during your retirement...

Savings - you will not necessarily have a need to continue saving at the level you were at during your working years.  You may see an expense reduction of 5 - 20% here.

Work Expenses - commuting costs is one example that will probably be reduced significantly.  The expense reduction could be in the 3 - 5% range.

Social Security Taxes - you won't be paying into Social Security since you won't necessarily be working or your work load may be cut back substantially.  Expense reduction could be in the 6 - 8% range.

Reduced Income Taxes - your income will be lower, hence, taxes will be less.  Savings could be in the 7 - 10 % range.

Mortgage Expense - your house may be near or at being paid off during retirement.  Expense savings could be in the 10 - 30% range.

Children - your kids are probably out of the house and this expense will be greatly reduced.

It's very possible that a retiree's overall expenses could be almost 50% less than it was during the working years.