Latest News

The Best Retirement Spending Advice From Our Readers


Your spending in retirement likely will equal, or exceed, what you’re spending while working.
Illustration: Paul Blow

Regarding “rules” for budgeting in retirement, I set aside $100,000 in what I call my “Stuff Happens” account. It’s designed to get me through five years of unexpected and one-time expenses. My buddies have adopted the same approach.

Clearly your friends know a good idea when they hear one.

Those comments, from

Roger Bretting,
a retiree in Houston, were among many we received in response to my recent column about what I call my “$400 rule,” a household budgeting approach that I have adopted in retirement. The rule says that on average a retired couple will spend $400 a month more than they expect. This has proved correct in my case. In my column, I invited readers—retired or about to be—to share with me any rules, recommendations or strategies they have developed or embraced to fine-tune their own spending and saving habits.

My thanks to all who took the time to write. What follows are some of the most helpful ideas we received—starting with a warning.

Plan to be surprised

Interestingly, almost every reader asked me to warn people approaching retirement: Your spending in retirement likely will equal, or exceed, what you’re spending while working. Put another way: Take the conventional wisdom about needing 70% to 80% of your preretirement income to maintain your standard of living in later life and junk it.

“My wife and I spend 50% more in retirement than we did when working,” says

Bob Bailey,
77, a retired advertising executive in Evanston, Ill. “There are two causes. First, we have time for travel, especially international travel. Second, we have volunteered in our community and discovered many needs; as such, our charitable giving has substantially expanded.”


Kevin Baughman,
68, a retired pharmaceutical executive in Santa Rosa, Calif.: “I couldn’t see how I could spend less in retirement, given that I’d have more free time. So I targeted 90%. As I got closer to retiring, I moved it to 100%. My reality turned out to be closer to 110%.”

The single exception to this thinking among the comments we received: a couple who retired to a small town in Alabama. Their strategy:

“We expected the cost of living here to be lower than that in a third-tier city. However, we didn’t expect it to be substantially lower. We live better than we did in the city, in a nicer home, engage in far more activities, and spend less. We would advise anyone planning retirement to consider moving to a small town for both quality of life and financial reasons.”

Keep budgeting

If you develop a household budget for retirement—great. But a number of readers told us: This isn’t, or shouldn’t be, a one-time exercise. It’s critical, they said, to refine your budget annually.

“My wife and I consciously research ways to ‘cost reduce’ each year,” writes

H.L. Singer,
76, a retired chief executive officer in Melbourne, Fla. Among their steps, small and large: reviewing and, as necessary, changing (or simply canceling) streaming services and magazine/newspaper subscriptions; booking travel a year in advance; fixing more meals at home; making better use of programmable thermostats; researching purchases and then waiting for sales and coupons.

Mr. Singer says: “We have found that by constantly looking for ways to lower expenses and buying smart we can do a better job of making our retirement savings and pension go further.”

Leave wiggle room in the budget 

In my earlier column, I set out my personal retirement rule: Calculate a household budget for the year—and then add $5,000 (roughly, $400 a month) for out-of-the-blue bills. That total will be closer to the income you’ll actually need. Several readers told me my math wouldn’t work for all parts of the country (read: high-cost areas) and offered a better solution: simply add 10% to whatever budget you first produce.

Ask Encore

Have a question about planning for and living in retirement? Email

“It seems almost every month there is an ‘extraordinary’ expense that blows the budget,” writes

Michael Arvanetakis,
69, in Cypress, Texas. “My wife and I have encountered this our whole lives. Our rule is add 10% to your budget—always.”

Ronald Londe,
76, a retired energy-stock analyst in St. Louis, made a similar point. His rule: “During December each year, I work up an estimated family budget for the coming year. On the total expected spending, I add 5% for inflation and 10% for unknown events. I then adjust my income ‘bucket’—primarily quality dividend stocks—to generate the required annual cash.”

Start a rainy-day account 

Another way to handle the unexpected: rainy-day money. Mr. Bretting, at the top of this column, is one of several retirees who say they squirreled away a chunk of money expressly to cover unanticipated bills early in retirement, when nest eggs are at their most vulnerable. His “Stuff Happens” account, he writes, has been a “mental lifesaver.”

“In the 2½ years that I have been retired, I have paid $8,500 for frozen-pipe damage; $3,500 for my spouse’s dental issues (no dental insurance); $25,000 for my youngest needing an extra semester of college to graduate; $1,500 for two accidental drownings of cellphones; and $5,000 in flood damage to our sprinkler system and landscape.”

He concludes: “I do sleep better at night knowing there’s still some money available for the next ‘Stuff Happens’ event.”

Fluffy and Fido? Maybe not


Bruce Woods,
a retiree in Seneca, S.C., has more than a dozen financial strategies for retirement, but one rule jumps out:

“If you have pets, don’t replace them,” he says. “My wife and I travel a lot more in retirement, and the bills for kennel care were over $1,000 a year. Get out the pictures of them and enjoy hair-free furniture. You won’t miss the constant picking up and cleaning up after them.”

Mr. Ruffenach is a former reporter and editor for The Wall Street Journal. Ask Encore examines financial issues for those thinking about, planning and living their retirement. Send questions and comments to

Biden open to canceling $10,000 in student loans per borrower — what that means for your budget, credit score and tax bill

Previous article

Best Energy Stocks To Buy In June

Next article

You may also like


Leave a reply

Your email address will not be published. Required fields are marked *

More in Latest News