Retirement is a period in your life where you’re able to have complete control over your schedule, your personal priorities and how you define living a meaningful and purposeful life.
It’s a very exciting time of life.
The early stages of retirement are new, and these newfound freedoms create the potential for new lifestyle expenses now that you have more time available to you.
Expense management and forecasting is one of the most important ongoing concerns of all retirees.
Not only is it important for you to develop a retirement budget, but you need to factor in the impact of inflationary pressures.
A movie and a bag of popcorn no longer costs $1 like it did 25 years ago thanks to inflation among other things!
Because of inflationary pressures, every year your total budget requirements will go up.
It's amazing how a small increase of 2% every year can have a big impact over a ten-year period.
Let’s put some real numbers to this:
$70,000 with average inflation rate of 2% has the same purchasing power as $85,329.61 10 years later.
That’s a 15,329.61 difference which can be quite substantial on your retirement portfolio drawdown over time.
So how much can you safely spend in retirement?
This video highlights the impact of inflation and outlines strategies for coping with this subtle long-term risk to your retirement.
For anyone wanting to get serious about planning their retirement, contact us in order to discuss how we can help!
Our Retirement Coaching page provides additional details on how our process can help you!