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Some people have a lot of costs associated with working. Sure there's the commute, clothes, lunches, etc. While others do not. Then there's lifestyle in general. Some folks can't live without cable, and the gym and country club memberships. Lots of other people would never buy these things.
I was in the habit of living way below my means. And I decided years ago I was willing to give up a lot to be able to retire young and walk away from the rat race. I didn't want to die at my desk! It's all about how much value you put on not having to go to work every day. NOT going to work every day makes me rich. No matter how much money I have!
Sure I wish I could afford to travel all the time and just blow wads of cash. But I know I have to be reasonable and I accept that fact. I live well but I am frugal. Part of my retirement plan was to spend time making sure I got the most value I could for every dollar I spend. And now I have time to do that! When work was 12 hour days there were times I had to chose convenience over the best deal.
As I previously stated, the mistake most people make is chasing their tail instead of truly planning. And I'm not talking about planning for a bank roll when you retire. That's great but not everyone can accomplish that. It's REALLY knowing what you spend your money one. I've heard too many times people saying they know when in fact they don't. Until you keep true track (including cash spent), you don't really know how much those restaurants cost, or auto gas, etc. I say this from experience sitting with many clients over the decades (I'm a CPA).
We retired in '99, mid 50s, DW's pension of about $1200/mo and an unbelievable insurance package, IMO, costing about $180. I had been self-employed and probably would have worked quite a few years longer had we not had that package. At the time our out-of-pocket doctor/hospital expenses could not exceed $1000/yr., and that would have required a horrible illness. Of course, when Uncle Sam stepped in to lend a helping hand with Medicare at 65, our 180 went to, what, 105 per each, so about $400. And less coverage. Hope we don't get sick!
So we went from about 150k to maybe 60k, living off what our IRAs would throw off and her pension. We didn't miss the difference as our last child graduated and we had no more tuition costs for the first time since grade school. (I'm probably forgetting some things, but this is real close.)
So, 17 years later we find we could get by with our SS and her pension alone. The IRS RMD on our IRAs gives us all we need. Our savings have weathered all the market ups and downs. My only complaint in that area is that bond yields over the last many years have required us remaining in equities far more than I thought we would be at this stage of our lives. Our goal is to croak with the same savings we had a few years ago. So far, so good.
None of the kids need anything, so we should probably be drawing down to zero, but timing that is something I can't figure out. So I guess we'll just keep on chugging along as we are.
My one regret is that we didn't take advantage of ROTHs. Having worked in Congress for decades (mostly as a contractor) and knowing the total disregard those jerks have for the taxpayer, the thought of paying even more taxes in my earning years caused me to, well, cut off my nose to spite my face, you could say. Of course, with the current spending situation having gone off the cliff, I feel even worse about every taxable IRA dollar we draw.
Obviously the lifestyle one anticipates living in retirement is a huge X factor, but just in general terms, I find that the recommended percentages tend to be on the high side - which, given that most of the calculators and other sources for these types of articles come from financial services companies trying to get people to invest with them, seems a bit self-serving.
No, I don't want to rely solely on Social Security. But on the other hand, if I'm taking 15% out from my gross income to put towards retirement, that's 15% right off the top I don't need to worry about. So from a base of 85% of current income, then I can calculate what percentage of income I need to try to achieve, using that as a rough guideline since I'm too far away from retirement to do much other than ballparking. I expect to have no mortgage payment in retirement (current home will be all or mostly paid off and I anticipate paying cash for something smaller) so that's another huge chunk. I had my kid late in life so still paying for some childcare, summer camp, etc. Another 5%+ of current income going to that I'll no longer need in retirement. And so on.
And of course since I'm about 15 years out, I expect my income to keep increasing. When I do my back of the envelope calculations, they are based on what I'm earning right now. I anticipate mostly maintaining current standard of living and putting all salary increases into savings, although some will be for college for my kid, most will go towards retirement.
So sure, when I read the articles and do the calculators, it feels like I'm WAY far behind. But when I start to think about my specific situation, I'm feeling a lot more confident that I will have enough to live a reasonable lifestyle. Not an extravagant one, but I don't live that way now anyway.
We retired in '99, mid 50s, DW's pension of about $1200/mo and an unbelievable insurance package, IMO, costing about $180. I had been self-employed and probably would have worked quite a few years longer had we not had that package. At the time our out-of-pocket doctor/hospital expenses could not exceed $1000/yr., and that would have required a horrible illness. Of course, when Uncle Sam stepped in to lend a helping hand with Medicare at 65, our 180 went to, what, 105 per each, so about $400. And less coverage. Hope we don't get sick!
So we went from about 150k to maybe 60k, living off what our IRAs would throw off and her pension. We didn't miss the difference as our last child graduated and we had no more tuition costs for the first time since grade school. (I'm probably forgetting some things, but this is real close.)
So, 17 years later we find we could get by with our SS and her pension alone. The IRS RMD on our IRAs gives us all we need. Our savings have weathered all the market ups and downs. My only complaint in that area is that bond yields over the last many years have required us remaining in equities far more than I thought we would be at this stage of our lives. Our goal is to croak with the same savings we had a few years ago. So far, so good.
None of the kids need anything, so we should probably be drawing down to zero, but timing that is something I can't figure out. So I guess we'll just keep on chugging along as we are.
My one regret is that we didn't take advantage of ROTHs. Having worked in Congress for decades (mostly as a contractor) and knowing the total disregard those jerks have for the taxpayer, the thought of paying even more taxes in my earning years caused me to, well, cut off my nose to spite my face, you could say. Of course, with the current spending situation having gone off the cliff, I feel even worse about every taxable IRA dollar we draw.
When we worked we lived on 30 percent of our gross income. The rest went to our emergency savings account, retirement savings and extra payments to pay off our mortgage early. We never spent much of anything on vacations and lived simply, but very happily. Now in retirement, we continue to live simply, but don't have a mortgage and sold one of our vehicles to save on maintenance and insurance costs. The one thing that increased greatly was our health insurance premium. Over the eight years we've been retired the premium went from about $290 to $908 per month. We're not quite to Medicare age, but will be soon and expect to pay somewhat less at that time. As I've said before, medical costs are the one thing that is difficult to control and the sky seems to be the limit. So, I would plan for the worst for that expense.
As I previously stated, the mistake most people make is chasing their tail instead of truly planning. And I'm not talking about planning for a bank roll when you retire. That's great but not everyone can accomplish that. It's REALLY knowing what you spend your money one. I've heard too many times people saying they know when in fact they don't. Until you keep true track (including cash spent), you don't really know how much those restaurants cost, or auto gas, etc. I say this from experience sitting with many clients over the decades (I'm a CPA).
I'm still 7 years from when I'm planning to retire but I'm already living on a bit less than my planned retirement cash flow. I need somewhat more when I'm retired to cover a $10K health care guestimate. I use credit cards for almost everything and only a trace amount of cash so I could sit down and categorize my spending if I wanted to but I really don't need to get that kind of granularity on my spending. I already took the steps 7 years ago to adopt a lifestyle that is sustainable on what I think I'll have for my retirement cash flow. I'm banking the difference while I'm working.
I'm still 7 years from when I'm planning to retire but I'm already living on a bit less than my planned retirement cash flow. I need somewhat more when I'm retired to cover a $10K health care guestimate. I use credit cards for almost everything and only a trace amount of cash so I could sit down and categorize my spending if I wanted to but I really don't need to get that kind of granularity on my spending. I already took the steps 7 years ago to adopt a lifestyle that is sustainable on what I think I'll have for my retirement cash flow. I'm banking the difference while I'm working.
That's great. Sometimes life derails plans though, and of course in those situations all you can do is adjust. There are many people though that walk through life without giving the future much thought, and others who over plan while smothering years when they could be enjoying them more. It's tough.
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So I guess we'll just keep on chugging along as we are. 
