Do you expect that your Social Security will be partially indexed to inflation?

I doubt that it'll be fully indexed.

Unless it is, you need to calculate that your income from Social Security won't grow as fast as your expenses.

With all of that Boomer crowd due to retire in the next 20 - 30 years ... many feel that increases in Social Security are very improbable, in fact, some shrinkage of coverage is much more likely.

Now ... or ten years down the road.

Or thirty - we've been living much longer, in recent years.

I find it much more pleasant to have a couple of bucks extra ...

... rather than being a couple of bucks short.

I'd feel uncomfortable retiring with only 70% of previous income initially, for I think that you'll be needing at least that much to live on (without planning for major travel, cruises, etc). at that point.

With the prospect that expenses will likely increase more rapidly than income, in future years - without allowing for the major probability that there'll be larger medical expenses, whether via insurance or out-of-pocket costs for services (especially as I assume that you are a U.S. resident).

Will you have a paid-for home to sell, in a higher priced area, to move to a smaller place in that market, thus planning on some asset left over (but don't forget the costs of selling and buying). Would you be willing to move to an area where there is less industry and business, so less attractive, with house prices lower? Would you be willing to leave current friends, relatives, etc.? And would you be happy, living there? Or if you plan to continue in your current home, to sell it when it suits you, to provide increased asset to fund your retirement life? And don't forget that from then on, you'll have increased expense due to renting a roof over your head. Especially if that residence is in a retirement or nursing home.

Do you have some interests that you might be able to develop or increase, to provide some supplementary income during retirement?

Baby-sitting, pet-sitting (or dog-walking)? My daughter, who inherited her Mom's old mini Dachsie on her death upwards of three years ago, has travelled about four times in the past year (she works on computer, so whereever she can plug into high-speed connection, she's in business) ... and left the female canine ("dog" is male) with her Dad while doing it. Much cheaper than boarded in a kennel or with a vet. And the F C loves to spend hours out running around the yard on the farm, when the weather is warm (and we haven't made her a coat, yet - maybe we can get some fake fur and make one for her before winter - I douubt that she'd turn up her nose, due to its being "fake"). Trouble is ... as she's 14 ... she may not live that long?

Possibly house-sitting while retired folks go on a cruise, visit kids, winter in FL, AZ, etc. ... as most insurance contracts become void, or offer greatly reduced payouts, if one makes a claim when the owners/renters are absent and the residence has not been visited at least once every three days or similar.

Church, social, sport-related or seniors' groups might have members who would be pleased to have you do such, if they knew you well (or had excellent references).

Do you have skill that you could market?

Just some thoughts that may be of interest.

ole joyful

Retirement can be a real leap of faith, but it affects different people in different ways. I retired at 55 and still have a ways to go before I can think about Social Security. I knew early on that retiring at 55 was my dream and I saved to the max for that dream.

From my experience working was expensive - I worked in DC, but lived in the MD suburbs so had the Metro fare and parking, plus gas to Metro to deal with. Clothes, coffee breaks, lunches either on site or out (which we did a lot of)came at a price. Not to mention the things that occur during the course of a year - wedding and baby showers, funerals and retirements, chip-ins for this, that and the other, Christmas parties, etc. I was amazed at how much I was spending just because I was working. And, of course, the Metro DC area is an expensive place to live.

For me personally, my expenses are smaller because my needs and wants are smaller here in Minnesota. I made a conscious choice to live within the confines of my pension, interest and dividends. Social Security will be a bonus when I decide to take it, same for my 401k.

Are you satisfied with your savings plan to date with assets to fall back on if necessary? Would an emergency expense throw you for a loop? Will 70% of your current income leave you really scaling back your current lifestyle? Do you have a plan for what you'd like to do in retirement, pursue hobbies, travel, volunteer work, taking a class or two, just relaxing and enjoying it?

In answer to your question, certain expenses, those associated with going to work, do reduce. In my case, I retired at age 62 and it was not my choice. My job went away. I was offered a choice, stay and hope for enough work to keep me employed to my full retirement age, or accept a buy-out package. I took the buy-out package since it was equitable and a sure thing; It was iffy if there would be work at my location and I forecast a good possibility that I'd be out of work within 6 months. It was a scarry proposition for me, but has turned out ok.

My costs did reduce, but for the first two years. I did not do anything that would 'cost money'. I was concerned about what would I do when it came time to replace my vehicle. Here's what I found: The costs that reduced the most were commuting to the job, food and snacks at the job, and office clothing. My wife and I still eat out a couple of times a week, but do not make this a habit. Eating meals at home is a cost reduction depending on what you are satisified with. Miles per year on my vehicles fell a bunch along with operating cost. I started walking to the local grocery store more often rather than driving - forces me to take a needed walk! I don't need as many replacement clothes to wear at the office. I now wear stuff until they are more worn than before, and put on 'good clothes' only as the occasion warrants it. I don't save on shoes and socks since I am walkikng more to replace the exercise that was associated with my job.

On snowy winter mornings, I open one eye to see if its snowing and if it is, I'm in no hurry to get up. Getting out to clear the sidewalk by 10:00 AM after the snow plows have made their passes is soon enough. I keep one old car ( 4 wheel drive Jeep) for winter driving and garage my better car in the winter. The better car does not go out if there is salt on the street. Typically, this car is driven from April 20 through Nov. 20 and is garaged all winter. I bought a "98 model in 2002 and it is still as good looking as the day I got it. The winter-time vehicle, however, needs to be replaced this year. It has 190,000 miles on it.

The costs that have increased are real estate taxes, heating fuel, electricity, food, and gasoline. As the years go by, I can also expect maintence medication and doctor visits to increase.

We have considered moving to a lower, warmer location to reduce costs, but this is our home and two of our children are nearby plus friends. Starting over in a new location is a negative that is holding us back from moving. We have researched many possible locations to move to, but none are perfect. The primary driver is to reduce winter, however, we do not want to roast in the summer heat either. Reducing winter is a cost reduction only if your air conditioning needs do not overshadow any savings.

Yes, you can retire on 70% of your former salary if you are willing to make cost cuts. Your imcome tax load will reduce especially if your investment income comes from excused sources. Check with the IRS for the rules about this.

Do plan a to have a low cost activity to occupy your free time, else you will go bonkers. This can range from hobbies, volunteer work, to part time work.

Many people feel that when they visit friends, they must *do* something ... play cards (sometimes for money), drink, etc.

As far as I'm concerned, just going to someone's house and talking for a couple of hours suits me fine.

But ... I'm a talker. With a wide variety of interests.

I usually encourage others to talk, too, so they don't get bored out of their skull, just listening to me.

Some time ago I called in to a financial planning discussion of the radio and said that, at 70, I figured that I should fund to age 100, which was 6 blocks of 5 years each, and I'd be some stupid if I ate up more than the first 5-year block in the first ten years ... for it would no longer be present to provide future income. And I'd be pying higher prices in future, as well.

So, since I didn't plan to use them for ten years, I figured that it made sense to have much of those five blocks in well-chosen, quality equity investments.

The planner said that sounded like a good plan.

Now, 8 years later, I'm still running with it.

Actually, I'm living on less than my three pensions, so am saving some of that.

Of the three pensions, one is from the government (residence requirement, non-contributory), one a government-required and managed contributory one, and one private, co-funded with an earlier employer.

Plus I have a self-funded and managed tax-deferred retirement plan ... but wouldn't have one, were I a young Canadian these days, for several reasons. One for your spouse, maybe, if she doesn't have a pension plan.

But most financial advisors say that every employed taxpayer should have one.

I hope that you have a great retirement.

I wish you good health, good friends, some things to do and enough to live on comfortably ... in 30 years' time.

ole joyful