One of the biggest questions you'll face when it comes to planning for your retirement is how much it will cost for you to live once you've retired. Because there are so many unknowns, many standard retirement planning tools assume your costs will remain where they were before you stopped working, after adjusting for inflation.

While that can be OK as a discussion starter, it could also lead you to save way more than you really need to have a reasonably comfortable retirement. That's because, as the following table shows, people's spending -- other than on healthcare needs -- tends to decline as they get deeper into retirement. Recognizing that reality makes it perhaps the most important retirement table you'll ever see.

Senior looking out over water.

Image source: Getty Images

Real people, real spending

The data for the below comes from the 2021 American Community Survey. It's a program run by the U.S. Census Bureau every year that's designed to get a handle on key demographic and economic trends. That annual pulse makes it valuable both in understanding trends and in making sure it represents a reasonably recent snapshot of what's happening in the country.

Age Bracket

Average Expenses

Average Healthcare Costs

Average Expenses Excluding Healthcare

Under 25
























75 and up




Data source: 2021 American Community Survey. 

In essence, it suggests that people's total costs of living tend to be the highest between their mid-40s and mid-50s. That would make sense, as that's around where you can find yourself in the "sandwich generation," taking care of both your own not yet independent children and your now aging parents.

The good news, though, is that after that point, people tend to see their costs drop off substantially. This is probably due to things like paying off mortgages and student loans and seeing kids become independent adults.

The trends continue into retirement, as once you retire, the costs associated with working also stop. Some of those are direct costs like commute costs, work wardrobes, work social events, and Social Security and Medicare payroll taxes. Others are indirect costs, like the costs of services you used to hire out because you were too busy with work but now have the time to take care of on your own.

In addition, it appears that, aside from healthcare costs, most people see their costs of living continue to decline the deeper into retirement that they get. Unfortunately, there may be a less than ideal relationship between your healthcare and non-healthcare retirement costs that you probably should prepare for. After all, if your health challenges start to increase as you age, it may be tougher to travel or even do much in the way of local activities above and beyond the basics. That can show up in these numbers as rising healthcare costs and lowered expenses elsewhere.

What does this mean for you?

When you put all that together, it means that you can probably get away with saving less for retirement than you might have originally thought. You'll still want a decent nest egg, of course. The typical retiree gets around $1,674 per month  from Social Security. That works out to just over $20,000 per year, which is still less than half of what a typical retiree spends. The rest of that money has to come from somewhere, and that somewhere is probably going to be at least in part from the nest egg you've built throughout your career.

If you plan around the way typical retirees spend their money, rather than the standard assumption that your costs won't change once you retire, you can get away with a much smaller nest egg. How much smaller? Well, you might be able to get away with one that's around half the size you originally anticipated.

After all, if your going-in assumption is that you'll spend $80,000 per year and that Social Security will cover only $20,000 of it, then you'll be planning around a nest egg that covers $60,000 per year. If, instead, your costs wind up closer to $50,000, while Social Security covers the same $20,000 of it, then your nest egg would need to cover only $30,000 per year.

Of course, in addition to your normal expenses, it's also important to prepare for the potential of those rising healthcare costs. Indeed, a retired couple may spend somewhere in the neighborhood of $300,000 on healthcare costs alone throughout their retirement. So be sure your plan includes both the positive aspects of spending less as you age as well as the risks of those expensive healthcare costs, in order to best protect yourself and your loved ones from the unpleasant costs that you may face.

Get started now

If nothing else, that table should tell you that a comfortable retirement could very well be within your reach, even if you're currently staring down some of the most expensive years of your life. Still, no matter how large a nest egg you think you'll need to cover your costs in retirement, the sooner you get started building it, the better your chances are of getting in place by the time you need it. So get started now, and improve your chances of having the nest egg you need to see you through.