To Budget or Not?

Richard Quinn  |  Oct 10, 2022

I’VE NEVER BUDGETED, meaning I’ve never planned every expense in detail. But I know many people do, especially as they look ahead to retirement.

This doesn’t mean I don’t know what I spend. My utility bill is $127 a month, my homeowners’ association fee is $870, my property taxes are $3,117 a quarter and my BritBox subscription is $5.99 a month. Or is it $6.99?

By the end of each month, our two credit cards are paid in full. There may or may not be much left in our checking accounts, but our spending never exceeds what’s in the bank. Our “budget” is set for us.

I didn’t retire until age 67 because I wanted to be sure I could generate income equal to 100% of my base salary, while also keeping up with inflation. Sure, I may have a shorter retirement than others who retired earlier, but mine is financially less stressful.

Many of those who are obsessed with keeping a budget are seeking to retire in their 50s. They’re trying to stretch their savings over a retirement that could be longer than the years they worked. I fear that may prove impossible.

Some people say they need a detailed budget to determine how much they can save. For example, according to, “Without a holistic picture of how much you spend every month, there’s no way to set savings, debt repayment, or investment goals. It’s a must, folks.”

Sorry, that’s backward. You save first and then see what you can spend.

Listening to a Retire with Style podcast, the commentators took two different approaches. One favored a very detailed budget. The other favored my formula of NE-S=S, meaning net earnings minus savings equals spending. This formula gives you your de facto budget.

Why stress over budgeting? If you’re about to retire, I maintain your overall spending will be the same as before, unless you’ve just paid off the mortgage. I hear someone saying, “Wait, once you’re retired, you’ll no longer be saving for retirement, right? Can’t you live on less income?”

Yes, if you’re one of those folks who saves 30% to 40% of your income, you may have a point. But for the great majority of Americans who save far less, you’ll still need to save something when retired because your spending will rise each year, thanks to inflation.

I’m prepared to be criticized for repeating myself. But I feel my approach is the safe one. Our monthly “spending” includes saving something each month, plus an allowance for discretionary spending such as travel, plus a provision for surprise expenses like the two new tires I recently bought, several thousand dollars in car repairs and $8,000 in dental bills.

Your spending will change over time. But I firmly believe there won’t be a significant decline. Keep in mind that many unforeseen expenses aren’t linked to your income. The cost of a new furnace will keep rising, no matter how much income you receive this year.

A 2014 survey claims that, after three years, retirees are living on 66% of pre-retirement income, on average, with more than half saying they live as well or better than when they were working. Is that possible? I’d like to see their pre- and post-retirement budgets.

Thoughts on budgeting vary widely. A comment from a friend has me bumfuzzled: “I started keeping a budget for one main reason. Financial advice websites kept saying we needed to have $X in annual income. I knew that wasn’t true since we lived on much less than our income for many years and lived comfortably, while putting away quite a bit. So, to determine if we could afford to retire early, I needed to figure out our real expenses/spending.”

No website can accurately say that you need $X in income. At best, it can estimate the financial resources you need to generate $X in income.

I just read a comment on a retirement blog. The commenter had $550,000 in savings, plus Social Security, and asked if that was sufficient to retire. What kind of question is that? Maybe yes, maybe no.

If, at the end of the month, there’s no money left in the bank, or if credit card balances can’t be paid off in full, an assessment of spending is necessary. That’s when a detailed look at where the money goes is important. Make adjustments and move on.

If that’s not your situation, you don’t need to spend hours constructing a detailed budget. That’s especially true if you’re trying to predict spending over decades of retirement—unless you just like playing with numbers.

My oft-maligned notion is that you start retirement with income equal to 100% of your base salary. For most people, Social Security will get them to 40% of that target. That 100% income replacement will provide the financial cushion necessary for a less-stressful retirement—but you might have to work past age 60 to achieve it.

This article first appeared on Check out the comments about this article on that site and see if you agree or not.


  1. I retired at age 50, with just a small military pension. Over the next 12 years I ran up $28,000 in credit card debt. Paid it all off in 30 months, once I started SS benefits at age 62. Now at age 66, I have purchased $18,000 in I-Bonds this year, currently paying 9.62%. I do not use a budget, but I use a free site called I have all my accounts listed and can see monthly balances out to Dec 2023. Living in Montana makes it easy to live on less. No state sales tax and I paid $23 in state income tax on $39,780 income. Zero Federal income tax. I use zero interest credit cards and credit cards with 3% to 5% cash back. Cash back rewards so far this year $750. For the next 3 months my Amazon / Chase card is paying 10% cash back on gasoline purchases. I even used a zero interest card to purchase $5,800 in I-Bonds for a $174 fee, I should make 3 times that in interest over the next 15 months. I just purchased a new laptop for $450, that I found on slickdeals $300 off, and I used a zero interest card and will not have to pay for it until Dec, 2023. I love using the Banksters money. I now have more income than during my working years and I am able to save for the first time in my life. I will have another $10,000 saved by Jan 2024. Credit Card Debt interest is one of the biggest drains on most people’s budget, get rid of it before retirement or you will suffer.


  2. I know that you do not like down to the penny budgeting. But you do budget. You know that you have to save money for your HOA, property taxes, utilities, etc. You have those figures in your head and know that you can’t spend that money on other things.

    Now I’ll admitted that I go overboard on tracking my expenses for three reasons. 1) I am the CFO of the house and I do not trust anyone with my money. Anybody that is dealing with me and my finances probably isn’t very good because they would be after people with money. 2) I have the time. I am retired. 3) I have gotten very good at predicting my expenses. Due to the records I keep in Quicken, I can often predict my vacation expenses very well. I just got back from a 9 state driving tour. I underestimated the mileage by 37 miles and was under budget or my estimate by $500. At no time on the trip did we say we can’t afford this if we found something we wanted to do or buy. There are a a lot of variables that I have gotten good at guessing at such as by how much we will over spend in one area on a road trip versus a cruise or something. We will not start the next trip until we have enough money to cover the estimated costs.

    Now because I am anal about my record keeping (I do not recommend this for everybody or anybody), I was aware of inflation almost two years ago. We kept over spending certain budget areas. At first I thought it was pandemic related shortages and price spikes. 18 months ago, I was able to prove that it was outright inflation even with the White House denying it. Last summer, the BLS started showing the increase in CPI. And the Federal Reserve was asleep. In two days the CPI will get release again. Hopefully it will be lower but that doesn’t mean that prices went down, just that they are not rising as fast year over year. Now there are certain things that I can’t cut from my budget such as taxes. But it helps me figure out which “wants” to be trimmed to cover the “needs”.


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