He has not been in the Army 2 years yet on his current enlistment. His prior enlistment was not concurrent with this one.
Glad for the info about matching going towards traditional no matter what he does. I have advised SIL/DD2 on moving the money in 401k into Roth IRA as long as it doesn’t bump them up in federal income tax category. Gave them step by step instructions on the fund transfer, redirect future funds, and aligning the Roth IRA investments.
I read a different story on the study.
I was surprised that the avg retiree in Mississippi spends $44k. I’d like to see a breakdown of what that entails. I know it includes housing, but is that taxes and insurance on a paid-off house or rent on a two-bedroom apartment or what? As I’ve mentioned in another thread, dh and I have started, for the first time, trying to follow a budget. We’ve only done the past four months and, not surprisingly, November and December were much higher, but an average month of spending for us is only about $4k. House paid off, no car loans, and we just live pretty simply.
Also, is this $1M per person or per couple?
How about y’all? How much is your monthly spending?
Article is interesting comparing COL. But, as we all know…. things can vary a lot by location within a state. Of course the million dollar figure is often augmented by pension(s). On a quick skim, not sure if they are also ignoring SS.
My son decided to contribute the max to 401K Roth even though his marginal Fed rate is 24% & he pays state taxes. TCJA tax cuts will expire at the end of 2025, at which point the 24% Fed rate will bump up to 28%. He can reconsider at that point.
He is also making a non-deductible IRA contribution that he can then roll over as a Backdoor Roth. His company does not offer the Mega Backdoor Roth.
One thing to keep in mind if he ever decides to withdraw funds from the Roth 401K is the different tax treatment compared to the individual Roth. One can withdraw only the contributions from an individual Roth and not pay taxes on the withdrawal, but 401K Roth withdrawals are pro-rata, consisting of contributions and earnings. The earnings portion will be subject to income tax + 10% penalty–similar to non-qualified 529 withdrawals.
Our monthly health insurance alone is over $2,000. Close to another $2,000 per month for real estate taxes, homeowners’ insurance, and condo dues. So, we are over $4,000 per month just for those things.
Scary how owning a home with no mortgage can still be so expensive. That $2,000 a month would pay rent in many parts of the country.
The variable of “what you live on now and what you plan to live on in retirement” hits home. We talked to a financial planner who ran some optimistic numbers re: us retiring in about 2 1/2 years.
But that was predicated on living on $6k a month. When we did an actual “what we spend now” expense-tracking (over 4 months)… what a wake-up call. Ugh we are way above that. 
So are working on reducing those monthly expenditures (although December gifts & travel made us seem even worse! lol)
I will say it’s super motivating to think “if I spend a few thousand less a month I can retire years sooner!”
TKS for posting.
According to the Datawrapper visual, MS 22 yrs 8 mo, AL 22 years. QOL, infrastructure, etc. so much better in a number of cities in AL. Property taxes relatively low as well in comparison to other states. Also MS is called out by Consumer Report for their drinking water - it was in a past issue but I can’t put my hands on it – they tested a number of places in MS, and all had issues with drinking water levels of various things. Jackson MS had trouble with their water/sewer system in recent past, and had to have a lot of water tanks etc. until the city could resolve the issue.
I look at our local water reports each year and save. We don’t drink bottled water or purchase the large water jugs.
Also some areas (in many states) have local ‘hard water’ - need home water softener and ongoing purchase of ‘salts’, which also helps certain appliances last longer without build up of various elements that make the water ‘hard’.
I know the state property tax rate in TX had many with property tax relief of thousands due to recent TX legislation (talked to relatives/friends on our TX trip). Lots of aggressive road work done in TX and tied to toll roads - we will see what our Toll Road expenses are with our billing (TX is on its own payment system, not part of the multi-state toll system - we have a device to put up when we drive in those states).
Yes, it all depends - paid off home, what you are paying for property taxes and other taxes, if you have a pension for example that is not included in state taxes (Military pension exclusion for example).
Most people on this thread choose where to live for a variety of reasons, and will choose to live in a higher cost area or higher cost state because they can.
Our net unearned income (this includes the deductions for our Medicare costs) more than meets our monthly expenditures…and we are not yet touching our principal. I’m hoping this continues.
I got a several-hundred-dollar drop in property taxes – and it was more than eaten up by increased home insurance rates. 
Easy come, easy go.
I agree. My folks retired and started to make money in retirement. They had no investments really. Only $25K in a 401K. They both had pensions and SS. House and cars paid for. Low property tax state. A little high for homeowner’s ins but their house is small. Dad passed in 2018 and we lost his pension. Mom is still taking in way more that she is spending.
Pensions are not as common for people approaching retirement now as they were for our parents, and they are even less common for our children. We are in that situation, and we are fortunate to have a good nest egg. We are spending it down at this point, since it’s the only money we have right now (holding off on SS until 70). That is why we saved, so we’re good with it.
One of the things in that article that’s absolutely true is the longer you wait to start saving for retirement, the higher the savings need to be each month/year/whatever. Many very smart young (and older, too) people do not think about or understand the concept of compounding. Deferred gratification is also difficult for many.
I always wonder what someone already mentioned - is that amount for a single person or couple. I have trouble with most similar articles because they aren’t clear.
I have never been covered by a pension, Way back when this old mom was a 30-40-something, IRA contributions were limited to $2,000/year. For around 12 (?) years, I duly contributed my $2k, getting high-interest CDs when interest rates were very high and then reading the NY Times for Fidelity fund recommendations (not Magellan because it had a fee). I stopped a few years after I adopted my daughter when I was almost 50. Although I went through some terrible financial times, I never opened the envelopes until after my father died when I was almost 66. Voila! through the magic of compounding, it was around $250k! which I rolled over to Vanguard along with my inheritance so I got a personal advisor. Although I am again not working due to apparent post-Covid illnesses, my current advisor tells me that at my current rate of spending which is truly modest, my money should last at least until my 99th birthday. I’ll take it!
Our SS is high enough we could live fairly comfortably on it, so we’re only taking 2% annually from our portfolio pretty much guaranteeing we won’t wipe it out (but we may try). We taught our son about compounding as part of his elementary math education. He opened an account with our broker when he was 11 and is well on his way to a secure retirement.
Our son has a TSP, Roth, and an E-trade account. He is so far ahead of where we were at his age which is why we’ve always been comfortable telling him we plan to die with a dollar. We probably won’t, but we’ve always felt it was important for him to understand that he must build his own wealth and make his own way in the world, completely independent of us. He absolutely understands the miracle of compound interest and the time value of money. He was raised on it.
Sounds like he is doing a good job of looking out for himself and I’m sure you probably had some influence on him being a saver. Good job.
What you spend while retired may differ from what you spend now.
Decreases:
Increases:
Income-related changes:
Imagine if high school math courses used compound interest as an example when teaching about exponential functions.
Excellent points, would be really helpful to folks gearing up for retirement planning. And the answer will of course vary greatly by situations.
For us, our “outflow” (post-tax income needed in retirement) is about the same in retirement as tracked prior, after reducing the total by our paid-off mortgage and church/other donations (now paid through DAF). In my monthly tallies I did omit college bills, since that pain was done before we retired. 401K savings were not in scope because they were deducted out of the paycheck. The biggie not included in tracking prior or post is the very occasional car purchase, which we typically fund through savings or sale of investments.
Actually my S (a couple of years out of college) is having more difficulty thinking about what to save for apart from retirement. He doesn’t need a car in downtown DC and feels that it’s a bad time to buy a house and that won’t improve quickly. It also seems unrealistic to save up the hundreds of thousands of dollars needed for a downpayment there anytime soon. So he’s wondering how much he really needs to keep in cash/non-retirement savings beyond a basic cushion, especially as he could withdraw the contributions from his Roth IRA in an emergency.
We’ve never kept much in non-retirement savings, beyond building equity in our house, due to the very high SEP-IRA contribution limits, but never needed a significant amount for a downpayment, as that was largely funded by the increase in value of our first (small) house. So I find it hard to advise him on how much he should aim to accumulate in savings.