Irresponsible retirement spending can lead to financial troubles

Jul 01, 2011

Low-budget vacations can help preserve nest egg

Retirees have long been told that if they can maintain 80 percent of their income once they stop working they will be financially sound, according to Bloomberg. However, recent reports have found that this simply is not the case.

"I'm finding that to be unrealistic with today's retirees," James R. Miller, president of Woodward Financial Advisors in Chapel Hill, told the media outlet. "It is more like 100 percent."

As retirees may spend less money on commuting, contributing to life insurance policies and their children, they also have more time for leisurely activities such as tennis or traveling. No longer worrying about putting money away for savings, some individuals may be too comfortable with taking money from the nest egg, .

In order to live the comfortable lifestyle, without running out of money, experts recommend lowering costs when possible. While traveling may be at the top of some bucket lists, flying on off-days or out-of-season could help people save hundreds, even thousands, of dollars. If the household only needs one car, selling the other could produce extra income. It may also allow retirees to cut insurance and gas payments down significantly.  

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