
Retirement Spending Expenditures
Senior Spending Patterns for Reality Retirement Planning | ||||||
Characteristics: | Age 55-64 | Age 65-74 | Age 75 & Older | |||
Income before taxes ... | $61,031 | $42,137 | $28,028 | |||
Average number in consumer unit: | ||||||
Persons ... | 2.1 | 1.9 | 1.5 | |||
Vehicles ... | 2.2 | 1.9 | 1.2 | |||
Percent homeowner ... | 83% | 83% | 78% | |||
% of Total | % of Total | % of Total | ||||
Average annual expenditures ... | $47,299 | $36,512 | $25,673 | |||
Food ... | 5,898 | 13% | 4,871 | 13% | 3,518 | 14% |
Food at home ... | 3,374 | 3,049 | 2,380 | |||
Food away from home ... | 2,524 | 1,822 | 1,138 | |||
Alcoholic beverages ... | 457 | 1% | 329 | 1% | 190 | 1% |
Housing ... | 14,339 | 30% | 11,152 | 31% | 9,381 | 36% |
Apparel and services ... | 1,863 | 4% | 1,200 | 3% | 604 | 2% |
Transportation ... | 8,421 | 18% | 6,506 | 18% | 3,286 | 13% |
Healthcare ... | 3,262 | 7% | 3,799 | 10% | 3,995 | 16% |
Entertainment ... | 2,823 | 6% | 1,879 | 5% | 990 | 4% |
Personal care products and services ... | 628 | 1% | 514 | 1% | 421 | 2% |
Reading ... | 177 | 0% | 158 | 0% | 135 | 1% |
Education ... | 730 | 2% | 352 | 1% | 198 | 1% |
Tobacco products and smoking supplies ... | 301 | 1% | 197 | 1% | 98 | 0% |
Miscellaneous ... | 825 | 2% | 735 | 2% | 547 | 2% |
Cash contributions ... | 1,752 | 4% | 2,471 | 7% | 1,542 | 6% |
Personal insurance and pensions ... | 5,825 | 12% | 2,348 | 6% | 856 | 3% |
100% | 100% | 100% | ||||
Source: Consumer Expenditures in 2004 U.S. Department of Labor-Bureau of Labor Statistics, April 2006 (Report 992) |
September 19th, 2011 at 7:05 pm
Your use of the BLS Consumer Expenditure Table data contains an error. Ty Bernicke made the same error in his original “Reality Retirement Planning” article. The “Personal insurance and pensions” entry line in these tables primarily contains the average RETIREMENT SAVINGS in the form of Social Security payroll deductions and other savings. You need to subtract out the retirement savings BEFORE calculating the annual spending reduction for the average retiree. Savings and spending should never be intermingled! A secondary error in Bernicke’s original paper was not to make a correction for the different average number of “Consumer Units” for the various age groups.
You can read more about these issues in the Wiki article .
March 13th, 2014 at 9:48 am
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