What Wichita Retirees Get Wrong About A Flat Retirement Budget
- Jonathan Harner, CFP®
- Jul 9
- 5 min read
A retirement budget that assumes your spending stays the same every year feels safe because it makes the future look nice and tidy.
The same spending every year plus a little inflation. Wash, rinse, and repeat until age 95.
It makes for a clean spreadsheet.
Retirement never actually works that way.
I see this often with Wichita couples getting close to retirement. They spent 30 or 40 years saving, living below their means, paying off debt, and doing the responsible thing. Then they get to the point where the big question changes to...
“How much can we safely spend without running out of money?”
That question sounds simple.
It isn’t.
Because a good retirement spending plan should not assume every year looks the same.
Many retirees spend more in the early years, less in the middle years, and more later if health care or care needs rise. The goal is to test those changes before retirement starts, so spending feels flexible without becoming reckless.
Retirement spending has seasons
Your first 5 to 10 years of retirement may look very different from your later years.
Early retirement is usually when people have the most energy and the best health. This is when travel, hobbies, home projects, family trips, and delayed purchases tend to happen.
You finally have time.
You may want to visit the places you talked about for years. You may want to take the
grandkids somewhere. You may want to buy the camper, update the kitchen, join the club, or take the long trip while your knees and back still cooperate.
That spending is not automatically reckless.
Sometimes spending more early in retirement makes sense. You are more likely to enjoy certain experiences at 62 than at 82.
But it has to be planned.
There is a difference between spending more on purpose and accidentally lighting the plan on fire.
The middle years usually get quieter
At some point, many retirees slow down.
Travel becomes less frequent. Big purchases become less common. Routines settle in.
The calendar still fills up, but it often fills up closer to home. Church, grandkids, golf, volunteering, family, coffee, doctor appointments, dinner with friends.
A lot of people spend less in this phase than they expected.
That matters because a one size fits all retirement plan may overstate what you need every single year. If the plan assumes your age 78 spending looks exactly like your age 63 spending, it may be too rigid.
It can make retirement look tighter than it really is.
That can cause a different kind of mistake. Some retirees underspend the years when they are healthy, then leave behind money they could have used to create memories, reduce stress, or help family while they were alive to see it.
Being too cautious can have a cost too.
Later retirement brings a different risk
The later years can go either direction.
Some people stay healthy and keep spending relatively low. Others face rising health care costs, home care, assisted living, memory care, or a spouse who needs more help.
This part can be difficult for many people to talk about. So, it gets ignored.
Fair enough. It is not exactly dinner party conversation.
But ignoring it is not a good idea.
Health care and long-term care costs can break the spreadsheet. A couple may spend less on travel and restaurants but far more on prescriptions, home modifications, help around the house, or care for one spouse.
That is why retirement spending planning cannot just be about the fun years.
A real plan has to ask harder questions.
What happens if one spouse needs care?
What happens if the healthy spouse lives another 10 or 15 years?
What happens if the market drops early in retirement while spending is higher?
What happens if the plan only works because we assumed every year would be average?
Average years are a nice planning fiction. Actual life rarely cooperates.
The flat withdrawal problem
A lot of retirement projections assume you will withdraw the same amount every year, adjusted for inflation.
For example, maybe the plan says you need $8,000 per month from Social Security, pensions, and portfolio withdrawals. Then it inflates that number every year for the rest of your life.
That method is nice and clean.
It is also easy to understand.
But it can miss how people actually spend.
A 63-year-old couple taking 3 trips a year, helping with a grandchild, and remodeling part of the house may spend more than they will at 78.
A 78-year-old couple may spend less on travel but more on health care.
An 88-year-old surviving spouse may have a totally different tax picture, income need, and care risk.
Same household. Different seasons. Different spending.
A flat withdrawal plan can still be useful as a starting point. It gives you a baseline.
But I would be careful treating it like truth.
The plan needs to be stress tested against real life, not just averaged into a tidy line.
Spending more early may be reasonable
This is where people get nervous, because when they hear “spend more early,” it can sound like a suggestion to be irresponsible.
Not necessarily.
A couple with enough assets, good income sources, reasonable cash reserves, and a tested withdrawal plan may be able to spend more during the first stage of retirement without putting the later years at risk.
The key word is “tested.”
You need to know what the trade offs are.
If you take the Europe trip, does the plan still work?
If you remodel the house, does it change your safe withdrawal range?
If you retire 1 year earlier, does it create a health insurance problem before Medicare?
If you spend more from age 62 to 70, does that still leave enough room for long-term care risk, taxes, and the surviving spouse?
These are not questions to answer with vibes.
They need math.
But the math should serve the life you actually want, not trap you inside a spreadsheet that assumes every year will look the same.
What a better retirement spending plan should test
A useful retirement spending plan should test different spending patterns.
At a minimum, I would want to review:
Higher spending in the first 5 to 10 years.
Lower lifestyle spending in the middle years.
Higher health care or care costs later.
A market decline early in retirement.
The death of one spouse.
A surviving spouse filing taxes as single.
Large one-time expenses like a car, roof, major trip, or helping adult children.
That does not mean the plan will predict everything.
It won’t.
The point is to see how much flexibility you have before retirement starts. Some households have more room than they think. Others are closer to the edge than the first spreadsheet suggests.
Both answers are useful.
False confidence is dangerous. So is unnecessary fear.
The real question
Most people ask, “How much can we spend each year?”
A better question is:
“How much can we spend in each stage of retirement without putting our later life, health care, taxes, or surviving spouse at risk?”
That question forces better planning.
It makes room for the fact that your first decade of retirement may be your best chance to
enjoy the money you saved.
It also respects the reality that later retirement can get expensive fast.
That balance is the work.
Simple. But not easy.
A flat retirement budget can make you feel safe while hiding the real risk. Retirement is going to change. Your health will change. Your spouse’s needs may change. Your desire to travel, spend, help, give, and simplify will change too.
So if your spending plan only works when life moves in a straight line, how much of a plan do you really have?
Disclaimer: This article is for educational purposes. It is not personalized advice, a recommendation, or an offer. Decisions about withdrawals, taxes, Social Security, Medicare, and long-term care depend on your full plan and current law. Talk with a CFP or CPA before acting.
