Why living cheap in retirement is OK

When living cheap in retirement is mentioned the first reaction of many is you are doing without or sacrificing.

They are wrong and you are right to retire.

You will hear over and over, "You can not do this".

Yes you can (sorry).

Just get ready for the naysayers when you announce plans to retire.

Don't let this be you, in fact you know living cheap is smart:

• You are convinced that retiring is far preferable to working
• You know there are no guarantees about tomorrow
• You know you will live a more frugal lifestyle in retirement
• You don't care what others think, you are retiring

If your plans for retirement are greeted with skepticism by co workers, your neighbors and "friends" take heart, that is good news, you are on the right track. You can be living cheap in retirement and enjoy yourself.

15 years ago we heard the same thing, you can't do this. Learn from our experience.

The facts are quite different:

• Most detractors are jealous of you


• Most detractors really want to retire as well
• Most detractors are trying to justify how they live...credit card debt, etc.
• Your financial planner has an interest in you continuing to work

The sad reality is that most people buy into working until 65 or what ever "normal" retirement age is supposed to be. This mindset is perpetuated by financial planners who lose clients when people retire.

Your lifestyle can and will change upon retirement

When you set down with your planner and discuss retirement, one of the first questions you will hear is how much are you spending a year now.

Why do they ask that question?

Someone at FPU, has told them you must have enough money to generate 80% of that figure to be able to retire.

Baloney

Our spending dropped from 5 to 6K a month to 1K a month when we retired.

You can do this folks.

Co workers, neighbors, "friends" and your financial planner will say it is impossible...it is not.

Take a look at us here. We are living cheap in retirement...poor, poor, us... so much sacrifice.

Our closet used to contain tailored suits, 50 pairs of shoes (Imelda?),
there was cable TV, newspapers, magazines, new cars, country club membership, general mindless consumption.

Replaced by the wardrobe you see above, no TV, no newspaper, a dinghy instead of 2 cars, a healthy lifestyle breathing fresh air 24 hours a day. It is sometimes hard to imagine how we spent a $1000 a month. Living cheap in retirement is doable...do we look deprived?

Oh, by the way...it was fun this can be you too.

You do not have to go sailing to be living cheap in retirement

Have no interest in sailing or boating? Fine, no problem. There are other ways of living cheap:

• Fulltime RV
• Park model living
• Living in a smaller house
• Living overseas

Can you get to $1000 a month? Yep,  doable if you relocate to Mexico, more difficult with the other methods.

$2,000 a month is probably a better figure when you stay in the US.

Why more here?

Your car is a big factor, you can go easily from 2 or 3 cars to 1 car, but it is still an expense.

Gas, maintenance and insurance.

Another necessary expense here in the US is health insurance. It is best to stay healthy. Do not overpay for insurance however, here is what we do and recommend for you.

Anywhere you can eliminate spending on clothes, newspapers, cable (when was the last time the news made you feel good), general wasteful   spending to keep up.

You know it seems tough to do but you also realize time is marching on. This makes  retiring now even more appropriate. You know you want to do this.

Conclusion

When you anounce that you are retiring early, get ready for an onslaught of "You can't do this", from co workers, neighbors, family and "friends"...they are jealous, they want to retire also, their lifestyle makes it impossible...credit card debt, etc. You are smart, you can do this.

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