Date: Tue, 10 May 2005 09:58:44 CST
From: Frank 
Newsgroups: misc.invest.financial-plan
Subject: Re: Income needed to retire on??
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> Thus, I can get along on about half as much after I retire, and still
> have just as much to spend on food, entertainment, travel, etc.

There may also be additional expenses that will negate some of the
savings and there is always inflation.

If your employer is providing at least some of your health insurance
you may end up paying for this or at least the difference between
the level of coverage you need and what is provided by Medicare.
And there is a premium on Medicare Part B that you have to pay.
There could be long term care expenses, additional drug expenses,
etc. Health Insurance premiums and health care costs could be
substantial(thousands of dollars each year).

And you definitely need to factor in some type of inflation rate.
$35,000 at age 65 will most likely not be nearly enough at age 75.
Most pensions do not have automatic cost of living increases and
Social Security cost of living increases may not be as much as
they are currently, dependent on any changes to the current benefit
structure.

And you could always have some other large expenses, house repairs,
purchase a new car, etc. Investment income may not be as expected,
etc.

It generally helps to look at several scenarios, at least a best
case, most likely and worst case. And assess how probable that
worst case is and whether or not you can live with it. There may
be some web sites that allow scenario testing and assigning
probabilities to various levels of investment earnings and expenses.
Maybe one of the mutual fund web sites, like T Rowe Price or
Vanguard?

Frank