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I practiced the 'lower' income budgeting five years prior to retiring. Had a general idea of what my s/s check would be and lived accordingly. Not only did that prevent the 'lower income shock' when I did retire, it afforded the opportunity to save more each month. Plus, by the time I retired I was completely debt free.
One other thing that worked for me: around the time that the stock market was being very 'bearish' and I started noticing drops in my 401k balance, I transferred a large amount into a high yield CD and a high interest return savings account.
Not being materialistic, not a clothes-addict, and very content if I don't take extravagant vacations every year, it was easy for me to cut back on spending and even to this day I have never felt I was sacrificing anything by being very frugal.
It's all relative since we're all unique....what works, is what works for each of us.
High yield CD??? Please tell me where you found it?
I'd also like to know where any "high yield" CDs exist!
More power to anyone who doesn't have to significantly downsize for retirement but given the declining economy, I think the OP's post makes a lot of sense.
The only thing I would add is think about "retiring in place" if a new home is in the cards. For example, avoid buying a home where the main bathroom is upstairs. What if you have a heart attack or can no longer climb stairs? Having everything, including laundry, on one level is a more sensible "retire in place" house and takes into account potential physical problems.
Ditto with any yards that can't be converted to low maintenance. Even a yard in a subdivision can be reconfigured with more rocks and features that wouldn't require weekly mowing (if one lives in such an area).
Oddly enough, the retirement scenarios painted by investment "counselors" of the 1980's and 90's were totally unlike what I have experienced through my own efforts and a bit of luck. My retirement income is almost double of what I earned the day I retired from a university after 25 years of employment. Thus, my tax burden is higher and I enjoy a better standard of living now. So you never know.
I didn't plan for retirement, never thought much about it. But our retirement income is actually pretty good so I'm not going to worry about it.
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Easing the hardships in retirement
