Retirement should technically be a wondrous time of life where you stop living to work and start working on living.
However, retirement in real life is nothing like the pop-culture depictions of retirement that we are used to seeing.
Retirement is a journey, not a goal. It is an elderly lifestyle funding account that must be exactingly calculated to last throughout the entirety of retirement.
Retirees, hopefully with the aid of a financial, need to develop a retirement number. A retirement number is the amount of money that they specifically need in their retirement fund to live a comfortable lifestyle.
Many people think a retirement number is a generalized number, like a $1 million nest egg. However, a retirement number must be exactly calculated to suit the needs of your expenses.
After considering inflation and the steadily rising cost of living, $3 million is the new generalized $1 million nest egg if you retire in a city with a high cost of living standard.
Funding your life
Want to hear a true-life retirement paradox? Pre-retirees can’t save money to retire, and they will probably have to retire early, and involuntarily.
Over 35% of Americans are dipping into their retirement savings to pay bills and necessities due to economic stress caused by the coronavirus pandemic. And 81% of those who retired early, before the average retirement age of 63, did so because of health problems or to care for a loved one with health problems.
Many retirees don’t calculate medical costs into their retirement numbers because it is too much to consider, especially when living on fixed incomes. The typical retired couple will need $400,000 for medical expenses throughout the entirety of their retirement.
The point is that as a retiree, you need to calculate your living expenses carefully. A retirement fund is meant to last from your mid-60s until death.
A great way to manage expenses in retirement is to live in a city with a low cost of living. Here are four cities where retirees can live on just $1,500 monthly:
Lansing, Michigan is located in the lower peninsula of the state about 90 miles west of Detroit. It has a population of 117,000. The average rent for a one-bedroom is $760.
Fort Wayne, Indiana
Fort Wayne is a city of 265,000. It is located about 132 miles slightly southwest of Lansing in the state of Indiana. The average mortgage payment is $740, and the average rent is $680.
Lawton is a small town in Oklahoma with a population of about 94,000. It is located about 200 miles slightly northwest of Dallas. The average rent is $800.
As long as you don’t mind small-town life, your retirement number will go far in Pittsburg,
Kansas. Pittsburg is a town of 20,000 located in the southwestern part of the state. It is 156 miles west of Wichita. The average mortgage is $900, and the average rent is $700.