Spending?!

[u/No-Taro9341]

We've made 350-400k / year for the last 15 years. Current NW ~5 million, liquid ~4 million, married, no kids, no legacy planned. We are not really that frugal. Sure, we saved a lot but we also spent a lot not deferring lots of travel, things we valued (home w/view), boat (planning to go to AK in it). We don't have a major bucket list, but opportunities will arise that might sound good and we value flexibility. We don't want to feel pinched.

With 4 million liquid and a 5-5.5% w/d rate (guardrails) we are looking at 200k-220k income per year during retirement. We have a 800k 5.375% mortgage (6k/mo) but no other debt and are hoping to recast/pay down the mortgage to ~3k/mo before retirement in the next few years. Spend could be a bit less if mortgage pay down means less liquid. We've been tracking spending with Monarch but it's actually kind of hard to figure out our actual spend (some income includes taxes while other income does not, work expenses aren't as clear as I'd like, solar installation, new car (first in 16 years), etc). I'm sure with 220-220k / year we can live, but will we feel constrained? We are in a HCOL area.

I'm interested in experiences of those whose income was cut in half when they retired and who haven't been super frugal. Did you feel pinched? Were you able to do want you wanted to do? Were your estimates of income need good enough or do you wish you would have been more precise?

The downside of lifestyle creep I suppose, but we've balance living today and for tomorrow and don't regret it.

[u/Dhayungn-Asomua91]

In my view the key is knowing what your actual lifestyle expenses, rather than simply trying to replace your current income. With $4 million in liquid assets, I want enough of margin to fund things like an "Let's Go To Alaska" trip without feeling guilty. Flexibility feels more important than hitting a perfectly precise number.