Reply to How much annual budget do you need to feel comfortable in retirement?

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[quote=Anonymous]Retired (early) at the end of ‘24 so I look at the numbers frequently to see if our expenses are where I thought they would be at…

Last year with both of us working, our income was around $520k.  That put our top marginal rate at 32% and an average effective tax rate at 26%.

I expected us to spend about $16k per month ($192k/ yr) in retirement pre-tax.  So far that has tracked pretty closely.  That includes $36k/ yr mortgage that will be paid off within a year, about $30k/ yr in travel and $4k/ yr for retiree healthcare premiums.  Property taxes are $13k and another $2k for our cars.

From what I have seen, our expenses have not changed much from our working years, but they have shifted.   We do spend less on lunches at work and dry cleaning but spend more on golf and other recreation activities.

Knowing your expense numbers and where future income will come and when is key. I used a couple of different planning tools to help validate.

Also, tax planning is pretty critical.  Post work, there are opportunities to pull some levers to do 401k conversions when your marginal rate drops.
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