Quote:
Originally Posted by DoubleF
Yes, different circumstances for different people, but I don't think the average pre-retirement arguments for lifestyle are in the 3-5x wages range let alone post retirement.
|
Agreed. It would be odd hearing that some people only need $60k a year to be comfortable in their working years, but some need $240k or $300k to have a decent lifestyle. Like you say, beyond 2-3x median income people recognize we’re no longer talking about
average or
need.
But for some reason, retirement is presented as a stage in life where expectations and needs will vary even more than in the rest of life. Which seems dubious. It
might be true of early retirement, when some people travel a lot, buy new cars, remodel their kitchen, dine out all the time, take up boating, etc. But I’d wager that by their 70s, the monthly spending of average and wealthy seniors actually converges.
Stuff that people over 70 no longer spend money on:
Mortgage
RESPs/RRSPs/TFSAs
Stuff that they probably no longer spend money on:
Home renos (house hunt in older neighbourhoods of the city for evidence)
New furniture (see above)
New cars
Stuff they likely spend less on than when they were 55:
Clothes
Driving
Travel
Restaurants
So even if Canadians have dramatically different (4-5x) spending habits at age 55 or 60, that gap will narrow substantially over the next two decades. Fixed expenses like property tax, utilities, insurance, and groceries don’t vary that much between households. So it’s hard to see how the remainder of discretionary expenses that 70 and 80 somethings have can require massive differences in savings.