How to Create a Retirement Budget
Determine the Amount of Income You’ll Need
Now that you know your expenses, you need to have an estimate of how much of your income goes into meeting those needs. One thing you should always remember is that during the phase of your retirement the income source will probably rise and fall. Chalk down your current expenses and this will give you an estimate of how much money you will need on a monthly basis. You and your partner need to brainstorm budget categories that do not currently exist but may exist in retirement. Many pre-retirees mistakenly assume they'll need only 70 to 80 percent of their current income. Take inflation into consideration. With the assistance of some financial planning software, you can create an estimate of how much of your money will depreciate over the next few decades.
