Estimate your expenses
The starting point of a good Retirement Plan is to build clarity on the lifestyle that you plan to lead post Retirement. You may start with some initial estimates but the challenge with that approach is that your estimates may be way off from your planned lifestyle.
At Ortium, we have built a “Retirement Expenses Calculator” which enables you to think through all your expenses in detail, thereby helping you accurately measure your likely expenses post retirement.
A step by step guide to measure your Retirement Expenses
Step 1. Monthly Expenses
We start planning for Retirement by thinking through our monthly expenses. These are expenses that you are likely to incur on:
(a) Utilities and House help
(b) Personal Consumption
(c) Travel and Transportation (excluding vacations)
(d) Healthcare (regular expenses)
Step 2. Annual Expenses
Step 2 is to estimate expenses that are generally incurred on a quarterly or an annual basis. These include:
(a) Insurance Premiums
(b) Housing (Property taxes etc.)
(c) Vacations
(d) Vehicles (Replacement cost)
3. Total Annual Expenses
Your total expenses is the sum total of all expenses that you have calculated above. It is a good idea to budget for 10% to 20% extra which might have got ignored while computing all your expenses. You can use this number as your starting point for your Retirement Planning.
Next Steps
I hope this step by step plan and the calculator helped you gain clarity on estimating your expenses post retirement.
At Ortium, we are committed to help individuals meet their Financial Goals and would be delighted to put together a savings plan for you that ensures that you lead a comfortable retired life! Please feel free to write to us and schedule a discussion.
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