[am1m]

Originally Posted by DigitalOne

We just have to adjust how we satisfy our indulgences.

Sorry to go on about this, but I sometimes find myself caught between two worlds. I've been working for over 20 years now and my 5 days a week are with people who earn very good money and always seem to want more. Dropping 7k for 5 people who show up to the office on a weekday, on "the new Japanese place" and getting that reimbursed by the office is 'normal'. That creeps into our personal spending as well. 200 bucks for coffee, 'upgrade' from a 10L car to a 20L one (and still get caught in the same traffic jam and crawl at 15kmph!), the next vacation "needs" to be in xyz destination...

On the other hand, thanks to an outdoor hobby, I also encounter some people who have decided that their lives will be spent pursuing their outdoor physical pursuits. They share expenses and manage to live for a month on amounts that my working colleagues and I sometimes spend on one weekend. But they seem happier, younger, healthier and more at peace.

Now love and fresh air are great, but don't pay medical bills in one's 60s. And after a certain age, sharing a single room loses its charm. But at the same time, should I be giving over the last maybe decade at best of my body being able to do whatever I ask of it to long hours and to building something that will only benefit a bunch of head honchos, just so I can pay 200-300% markup on "experiences" that are getting less satisfying each year, and online shopping for stuff I don't even remember I bought a week later, to make me feel better?

Obviously again, the balance is somewhere in between. But I fear it's already tilted disproportionately to one end. And hence the fear that it will never be "enough".

[kavensri]

Originally Posted by DigitalOne

This is a very useful and relevant video.

Summary:

Inflation-based models of retirement tend to overestimate the expenses during retirement. Actual data from retirees shows that you need much lesser corpus than estimated by inflation-based models. This is because for many categories the expenses come down. For example, transportation, eating out.

This is exactly I and people in my close circle keep discussing, since very long time. All the calculations that we get to see, simply assume that the spend category (and spend amount in each of those categories) remains the same even after retirement. But, I tend to disagree with that, especially in my case.
Even we did extensive analysis and found that around half of the spend categories (expenses) will go off or reduce considerably, post the retirement.
We also did some analysis with the real data. What we found was, we might need less than 1/3rd of our current spending if we happen to relocate from BLR to tier-2/3 city in Karnataka. This is assuming, we have our own house to live.

[m8002?]

All these moving to Tier 2 or Tier3 cities is just talk and will remain so. Very few people move back to smaller towns after spending 30+ years in a Tier 1 city. Not telling 0% but will be a very small number.

On top of that, even if thy move it will be to their home town where thy gre up and never to a 3rd location. For example, somebody from Mangalore may go back to mangalore amd never to Bidar or Hospet.

These is a huge emotional factor in these decisions and no spreadsheet calculations will capture that.

[INJAXN]

Originally Posted by m8002?

All these moving to Tier 2 or Tier3 cities is just talk and will remain so. Very few people move back to smaller towns after spending 30+ years in a Tier 1 city. Not telling 0% but will be a very small number.

On top of that, even if thy move it will be to their home town where thy gre up and never to a 3rd location. For example, somebody from Mangalore may go back to mangalore amd never to Bidar or Hospet.

This is true.
when I am thinking about this, only city that comes to my mind is my Native city - Indore. Moving there also is less likely because all the people I care about there, have already moved or might not be living there at the time of my retirement.
I love Goa, like most of the folks here do, I think of moving there permanently , like few folks here do, but truth be told, this is less likely going to happen.

The only case I will be moving to a different city all-together will be when that city has People I care about.
In the end, its not the city that calls you back, it's the People who once made it feel like home.

[DigitalOne]

Originally Posted by m8002?

These is a huge emotional factor in these decisions and no spreadsheet calculations will capture that.

Originally Posted by INJAXN

The only case I will be moving to a different city all-together will be when that city has People I care about.
In the end, its not the city that calls you back, it's the People who once made it feel like home.

The more feasible option is to move to the outskirts of a T-1 city, especially an area which is not so "hot" RE wise. You will be close enough to visit folks once a while in the city, yet your house rental/ownership costs will be lesser.

For Bengaluru, this would mean somewhere in the vicinity of NICE ORR from Kanakapura road to Tumkur Road.

[RGK]

Originally Posted by DigitalOne

We just have to adjust how we satisfy our indulgences. For instance,

• You have the time. So, take public transport. A BMTC bus ride costs me 1/10th of a taxi ride. Public transport is generally not very crowded during 11AM - 5PM. Travelling to/from railway station/airport by public transport saves considerable amount of money. .

My recently retired relative informed me that he does not send clothes to the dry cleaner for pressing (Rs 11/ pant/shirt/ Rs 20 /dhoti) and saves ~500 per month.

[BhayanaV]

Originally Posted by am1m

This struck me as something borne out by observation as well. I'm sure the majority of the retired couples I've seen growing up and at present have nowhere near as much stashed away as the financial advisors tell us is "absolute minimum" to hope to retire. Yet, they seem to lead their lives in comfort.

This is the reality. Post retirement no one has loans or kids study expenses liability, which is 50-70% of monthly expenses for us currently. And when i look around, majority in that age are content with a simple reliable car and basic necessities. So yes, finding our balance is very crucial. On the other end of spectrum, I can show real example of people having so much savings they struggle to find a meaningful use for it. They are struggling hard to prove saving so much was important, else their constant advice of "save for future" would be proven wrong.

[m8002?]

Originally Posted by BhayanaV

. And when i look around, majority in that age are content with a simple reliable car and basic necessities. So yes, finding our balance is very crucial.

Simple reliable car and basic necessities are very subjective terms. There is no fixed universal definition for them.

A simple reliable car can be a Camry for one, Creta for another and Alto for the 3rd guy. There can be a 4th questioning the very need for a car. Just use a cab after 60. The same for basic amenities. What is basic for one can be a luxury for another. And note, I am not going into the BPL or HNIs.

Its great to have all these discussions and share the viewpoints. But finally, its each to his own. Like you said, people need to find their balance.

[kavensri]

Originally Posted by m8002?

On top of that, even if thy move it will be to their home town where thy gre up and never to a 3rd location. For example, somebody from Mangalore may go back to mangalore amd never to Bidar or Hospet.

Luckily for me, my native place is tier-3 city, 3-hour drive from Bangalore, connected well to all my relatives places. So, it is a no brainer for me to move there after my retirement (in 2 years time).
In my friend's circle, four of my friends have moved in last 3-4 years. So, personally I do have a reference to look for, when I have to take my decision.

[Asish_VK]

Originally Posted by DigitalOne

Summary:

Inflation-based models of retirement tend to overestimate the expenses during retirement. Actual data from retirees shows that you need much lesser corpus than estimated by inflation-based models.

Thanks for this post! Most of the retirement numbers in this thread used to send me into a weekly existential crisis - so intense that I'd just stare into the void and come to terms with funding my 70's on instant noodles and sheer willpower

[PatienceWins]

Originally Posted by am1m

Obviously again, the balance is somewhere in between. But I fear it's already tilted disproportionately to one end. And hence the fear that it will never be "enough".

As you have explained nicely, the balance is in between and it is difficult to maintain it in the latter phases of career when you have to justify the higher pay with more responsibilities or by spending more hours at work.

In west, I have seen folks being freelancers working as per their schedule and taking long breaks. We also had senior colleagues working for a reduced number of days weekly. Do not see it nowadays, maybe as people are more insecure about losing their jobs.

A senior citizen who retires with enough money would not be able to venture outside and enjoy on a long trip as someone in their fifties. I think having a reduced work arrangement or retiring in early fifties should be the ideal way of life for someone who likes to enjoy life outdoors.

[kadanaJ]

I disagree with the above calculation based on the following logic:

- if I am currently living a lifestyle that involves 2 foreign vacations a year, I don't want to stop doing that post retirement. If anything, with all that free time, I would want to travel even more. Maybe rent a 3 month AirBnB and spend all 3 of those months in Switzerland, something I won't have time to do now
- when you have all that free time, one can easily find expensive ways to fill that free time
- people spend less in their retirement, not because they want to, but because they very often have to

[Sree]

Just discovered that ChatGPT can perform complicated maths ( for me) to calculate retirement corpus and how long it will last. Give it your monthly expenditure now, average inflation expected over next 25- 30 years ( I used historical data as reference) and your expected rate of return. Ask it to calculate on a monthly basis and wait . The answers may or may not shock you. It can convert everything into graphs or tables and tell you when your corpus peaks, when it will start declining and how much will be left behind at the end of the 25 years/30 years. It will tell you how much the end corpus is worth in today’s money so that you can mentally rationalise everything.

If nothing , it’s fun.

[Asish_VK]

Originally Posted by kadanaJ

I disagree with the above calculation based on the following logic:

- if I am currently living a lifestyle that involves 2 foreign vacations a year, I don't want to stop doing that post retirement. If anything, with all that free time, I would want to travel even more. Maybe rent a 3 month AirBnB and spend all 3 of those months in Switzerland, something I won't have time to do now
- when you have all that free time, one can easily find expensive ways to fill that free time
- people spend less in their retirement, not because they want to, but because they very often have to

I agree and disagree at the same time.

Ultimately, it comes down to the kind of retirement you envision. If your goal is to maintain (or even upgrade) your current lifestyle post-retirement (like taking extended international trips, spending seasons abroad, or indulging in hobbies that can be expensive), then yes, you’ll absolutely need a larger corpus. That means saving aggressively now to support that future.

On the other hand, if someone is content with a simpler, slower-paced life with modest needs, they may not need as large a retirement fund as some of the figures floating around on social media suggest.

I believe the original discussion was centered around a "safe" or baseline retirement corpus — enough to cover essential needs without financial stress, not necessarily a lavish lifestyle.

So, it's not one-size-fits-all. Retirement planning should align with the kind of life you want to live, not just average estimates.

[blueberry]

Talking about a conventional retirement at 60.

Originally Posted by kadanaJ

- if I am currently living a lifestyle that involves 2 foreign vacations a year, I don't want to stop doing that post retirement. If anything, with all that free time, I would want to travel even more.
- when you have all that free time, one can easily find expensive ways to fill that free time

I don’t think it’s lack of wanting to.
It’s lack of being able to (own health, friend group unable to sync schedules, grandkid duties).

In my parents circle, the largest reason why post retirement travel has slowed down is because all parents are vying for time with grandkids.
They drop everything else when opportunity opens up.

All that retirement corpus. Now just sits in investments marked for each grandchild.

Originally Posted by kadanaJ

- people spend less in their retirement, not because they want to, but because they very often have to

This I agree with. Majority of folks (unfortunately) fall in this bucket.

But I’ve also noticed that folks with means also have a mental block to spend (corpus so big that this is irrational)