If you hope to maintain your current lifestyle after you retire, you will need 60 percent to 85 percent of your current annual income, financial experts say.
Some planners say your living costs will fall somewhat after retirement; others say not to count on it.
"Why should you expect to live on less just because one day you quit work?" asked Richard Patterson, a chartered financial consultant and chartered life underwriter with Associated Planners Group Inc. in Winter Park, Fla.
Mr. Patterson said a retiree needs 80 percent to 85 percent of his or her working-life income. Anything less would require a drastic change in habits, he said.
John P. Stilwell II, a financial planner with HL Financial Group Inc. in Maitland, Fla., said a retiree can maintain his or her working lifestyle on less -- about 60 percent of the income.
"Often the house is paid for," Mr. Stilwell said. Other expenses can be lower, he said, such as a couple needing one car instead of two.
But those savings can be canceled, Mr. Stilwell noted, if the retiree plans to travel extensively. "If you weren't a world traveler before, you certainly can't become one on a portion of your working years' income," he said.
Most people are reluctant to live on less, said Steven Glenn, a chartered financial consultant in Orange Park, Fla. "If you drove ......TC Mercedes all your life, you're not likely to shift to a Chevrolet Chevette in your retirement years," he said.
"You still have to pay taxes, and, unfortunately, medical bills have a way of going up in those years," Mr. Glenn said. "You need as high a percentage of what you earned in your working years as possible."
He recommends a minimum of 75 percent of working income.
David Starkweather, a financial planner with IDS Financial Services Inc. in Orlando, also thinks at least 75 percent of working-life income is necessary in retirement.
Few people achieve that, he said. A few years ago, the national average net worth of couples at age 65 was $20,000.
Unless you're planning to hibernate -- and not many people want to do that -- figure on retiring with 75 percent to 80 percent of your previous income, said John R. Parke III, a financial adviser and president of John R. Parke Business Consultants Inc. in Fern Park, Fla.
Couples typically trade one set of expenses -- the costs of children and buying a home -- for others, such as travel.
June Wallace, a certified financial planner with Aegis Financial Advisors Inc. in Maitland, told of one couple who saw living costs escalate sharply after retirement because of extensive travel. The couple -- the exception rather than the rule, Mr. Wallace said -- had led a simple life and saved extensively for retirement so they could indulge their yen to travel.