Social Security – Living on Less

social security, retirement, financial planning, financial advisor colorado springs

There’s no simple answer. But to maintain your standard of living, you won’t need as much as you currently earn.

You will pay less tax

  • You won’t pay payroll tax on income from Social Security, savings, or employer pensions.

  • You won’t pay income tax on all your Social Security benefits

You won’t need to save for retirement.

The mortgage will probably be paid off (or will be soon).

The kids will probably be out on their own (or will be soon).

To maintain your standard of living, experts say you’ll need roughly %75 of your current income.

If work is difficult, you might want to retire early even if it means having a lower standard of living.

But be careful: You’re talking about a lower standard of living for the rest of your life. You’ll also need money on reserve for medical emergencies, unexpected home repairs, and other “rainy day” expenses.

© 2009, by Trustees of Boston College, Center for Retirement Research

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