Fiction: My income needs in retirement will be less than they are now, so I should base my retirement planning on that expectation.

Fact: Some people do have lower income needs when they retire. They may downsize their residence, indulge in fewer luxuries, or require less stuff after they've stopped working. When you consider how you want to spend your retirement, however, it makes sense to assume factors like potentially higher inflation rates, increased medical expenses, and the need for a good amount of discretionary income beyond your basic needs. (Why not indulge yourself once you've moved to this hard-earned stage of your life?)

You should work with a financial professional to be sure your retirement dreams and income needs are aligned.


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