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Speaker 1: I don't do very many financial based videos on this channel,

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but I came across a study by JP Morgan that

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I just thought I had to share with you. And

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it's all about the differences about retirement spending. About things

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we've heard for years and years and years and years

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that might actually be wrong, or at least according to

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this latest study. Now you've probably all heard the advice

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plan for seventy to eighty percent of your pre retirement income,

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you need at least a million dollars budget carefully keep

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spending steady. Well, this madeor study by JP Morgan Asset

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Management says otherwise. I will post the link to it

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in the comments so you can take a peek for yourself.

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But in fact, they found three big surprises in how

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real people actually spend their money in retirement. So today

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I'm going to walk you through them. They're clear, simple,

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and a few tips along the way to help you

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to prepare. So if you're new to my channel, my

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name is Marian Debernski and this is Life Starts at Retirement.

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My typical videos are about retirement lifestyle and how to

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make your retirement remarkable, but this is a little bit

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more on the financial advice, and it was really too

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good not to share, So let's dive in. Most people

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assume that retirement spending stays about the same every year,

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but increases with inflation. In fact, I've watched so many videos,

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video after video after video where the financial planner simply

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increases your financial plan by the rate of expected inflation

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until you die. But the data from this study from

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JP Morgan tells a very different story, and that it's

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actually a curve that happens. So it starts high in

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the early years, when you're acting, of when you're traveling,

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when you're checking things off your bucket list, and then

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it gradually declines through your seventies and eighties as life

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slows down. But of course it's not always the same

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for everyone. There's twists and turns in each person's One

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the biggest twist that we always think about is the

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healthcare challenges or healthcare spending as you age. So although

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your total spending might drop as you age, specific categories,

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especially healthcare, can rise. So this just means that your

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retirement plans just to be needs to be more than

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just a flatline budget. It needs a little bit more

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of that flexibility. Now I have a video about your

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go Go, Slow Go and no Go years that really

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explains this a little bit better. I'll link that in

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the comments. So the surprise number two about from this

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JP Morgan study was that retirement isn't necessarily all or nothing.

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And this is fairly recent. I'm going to say, within

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the last ten to maybe twenty years, that people when

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they retire don't necessarily now work for the same company

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for forty forty five years and then hoof, one day,

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they're gone. This study found that over half half of

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US households are what they call partially retired, so that

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means they've left their full time work behind. They still

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earn some income, maybe part time income, consulting, side hustles

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and something, so they're still having a part time income. Now,

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this is where I am. I left corporate Canada in

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two thousand and seven. I went out on my own

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as a mortgage broker. Worked really really hard, worked full

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time for years and years, but I was out on

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my own. Today, I still do private lending. I don't

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do much where would I still do private lending. I

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have a group of individuals that I work with. I

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have this YouTube channel and I speak on cruise ships

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as a destination or a cultural insights speaker. So I'm

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one of those half, although I'm in Canada, but I'm

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one of those households that still earns income from a

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part time income source. But here's the kicker. These households

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just like mine tend to spend more, especially for some reason,

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especially if they earn under one hundred and fifty thousand

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dollars a year. Now, why would that be? Why would

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these households tend to spend more? And I think it's

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simply because this extra income gives us permission to enjoy

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life a little bit more. We have more dinners out,

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we travel more, we have hobbies, we spend more I

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do on my grandkids. So instead of spending less in retirement,

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the people that are doing working part time actually spend more,

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at least in the beginning. But then, for reason the

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hire income households those earning one hundred and fifty thousand

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dollars or more don't show the same bump. Their spending

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stays flatter. And just I guess I'm going to say,

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if you're earning over one hundred and fifty thousand dollars more,

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it's more than just a part time gig. And if

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it's not, please let me know how you do that.

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But anyhow, but so what does this mean for you? Well,

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if your reply, if you are planning on retiring gradually

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or to retire on some part time income, just be

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prepared for that little spending spike, build it into your

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plan and just be aware of it. And here's the

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big one that they say is a shock. Now, I

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think this is typical, but they say spending is not consistence,

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it's volatile. In the years before and after retirement, over

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sixty percent of households experience of swing of over twenty

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percent more up or down compared to their previous spending.

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So think about it. In our twenties to twenty to

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about forty ish, we're spending a fair amount of money.

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We're just getting out on our own. We've got a

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new job, we have to get a new car. Oftentimes,

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then we meet someone, maybe get married, have children, buy

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our first home. There is a fair amount of spending

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in those early years. Forty late forties even to fifties

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were for me anyhow, that was probably my highest of

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my working spending years. We bought new vehicles, we traveled

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a lot, we upgraded our home, so there was a

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lot of bigger purchases for us. And then into retirement

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for us just simply because we travel so much, again

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we have a bump in spending, but it's different. And

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again because I work part time, that spending is still volatile.

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One month we'll spend a ton and then one month

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we're back at home, we're at the trailer doing not

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as much. So it's so volatile. It's up and it's down.

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And then finally, even people in their late seventies or eighties,

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they still seem to see a major shift in how

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much they spend year to year. Now, that could be

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maybe a big medical bill, in particular for anyone that's

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in the US. Canada we have free it's not free,

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but free healthcare, so we don't have that same spending worry.

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It could have been a home report repair, it could

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have been a wedding, sadly a funeral, or just maybe

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it's a once in a lifetime trip. So the point is,

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retirement spending is not as predictable as we've been led

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to believe. We've been led to believe here it is,

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there's inflation and a way you go, so your plan

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needs to be able to handle the bumps. Now, how

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do you use this information to your advantage? Well, first

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of all, ditch the flat spending estimate. Plan in phases

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early retirement, retirement, and later years. Again, they're called your

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go go years, your slowgo years, and your no go years.

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And as based on your lifestyle and your health, expect volatility.

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You know, build in a buffer in your retirement plan,

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whether it's an emergency fund or maybe a few more

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liquid investments. Make sure you can handle surprises in any

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of these years. And number three, don't underestimate the cost

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of freedom. If you're planning a fun and active retirement,

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especially early on, be honest with yourself about the cost.

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Now having said that, you've earned it, enjoy it. Don't

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feel guilty one little bit, just plan for it. So,

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just as a bit of a recap retirement, spending is curved,

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not flat, it's higher in partial retirement. If you're working,

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especially if you're working part time, you can give yourself

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permission to spend a little bit more and it's volatile.

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Big swings are normal even late in life. So this

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study challenges the traditional retirement advice and honestly, I think

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that's a good thing, because retirement isn't about hitting just

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one magic number. It's about living fully. It's about living

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with confidence, finding out who you are, knowing that your

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plan fits your real life. So let me just ask

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you this. Are you planning for a flat retirement or

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a flexible one? Have you accounted for the curve, the spikes,

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the surprises. If not, now's the perfect time to revisit

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your plan, your budget, and your priorities. So drop me,

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come it. Let me know how your retirement is, if

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any of these three surprises caught you off guard, or

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which one have you already experienced? And if you found

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this video helpful, don't forget to hit that like button.

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Subscribe for more real talk about retirement now, Oh, make

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your retirement remarkable. I'm Morey Dbranski. This is life starts

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at retirement. I'll see you next week.