Do keep in mind that the "official" inflation rate does not include many expenses that occur in day-to-day life. Healthcare expenses, especially home healthcare (for all those people who are solemnly vowing to never go into a facility), has risen faster than official inflation rates on a consistent basis.
The 'active phase' of retirement means spending on travel, restaurants, & entertainment goes up - sometimes way, way up, LOL. Consider what you would spend on a fun 2-week vacation (not necessarily your 'dream' trip, but one level higher than you normally would spend).
Then multiply that by how many 'bucket list' trips you think you're going to want to take in the first 2-5 years. You'll need to be comfortable with that amount. Remember to take into account any expenses that continue even when you aren't home, as well.
We were fortunate to do our first 2 yrs of retirement travels during The Great Recession of 2010-2011. Hotel prices were low, restaurant waitstaff practically wept with joy to see a couple come in to dine, discounts were everywhere.
Fast forward a decade, and what a change! Even before the jump in inflation hit, I remarked to Spouse that prices for our travels had risen 25-40% from those first years. And of course, they've continued to jump ever since.
Fortunately our income has increased so we still have a sizable discretionary budget. But although some items in our original planned retirement budget were priced on target, everyday things like public utility rates and remodeling costs have soared well past what we thought, 20 yrs ago, they would be.
So a long way of saying to the OP, you can do your own financial planning (we did, and our CFP firm complimented us on it), as long as you stay conservative on your income projections but build a comfortable amount of 'wiggle room' in your expense estimates. We used 20% as our 'extra' added budget itemizing, but YMMV.
Great start to your financial security, and best of luck going forward.
The 'active phase' of retirement means spending on travel, restaurants, & entertainment goes up - sometimes way, way up, LOL. Consider what you would spend on a fun 2-week vacation (not necessarily your 'dream' trip, but one level higher than you normally would spend).
Then multiply that by how many 'bucket list' trips you think you're going to want to take in the first 2-5 years. You'll need to be comfortable with that amount. Remember to take into account any expenses that continue even when you aren't home, as well.
We were fortunate to do our first 2 yrs of retirement travels during The Great Recession of 2010-2011. Hotel prices were low, restaurant waitstaff practically wept with joy to see a couple come in to dine, discounts were everywhere.
Fast forward a decade, and what a change! Even before the jump in inflation hit, I remarked to Spouse that prices for our travels had risen 25-40% from those first years. And of course, they've continued to jump ever since.
Fortunately our income has increased so we still have a sizable discretionary budget. But although some items in our original planned retirement budget were priced on target, everyday things like public utility rates and remodeling costs have soared well past what we thought, 20 yrs ago, they would be.
So a long way of saying to the OP, you can do your own financial planning (we did, and our CFP firm complimented us on it), as long as you stay conservative on your income projections but build a comfortable amount of 'wiggle room' in your expense estimates. We used 20% as our 'extra' added budget itemizing, but YMMV.
Great start to your financial security, and best of luck going forward.
