How Much Do People in Their 60s Spend in Retirement in 2025?

Core Insights - Fidelity estimates that a 65-year-old retiring in 2025 will need $172,500 for healthcare alone throughout retirement, excluding long-term care [1] - On average, Americans believe they need $1.26 million to retire comfortably, according to Northwestern Mutual's 2025 Planning & Progress Study [2] - The average household headed by someone aged 65 or older spent just over $60,000 in 2023, indicating that the average retirement savings estimate is $240,000 short of the actual amount needed for a sustainable lifestyle [3] Spending Patterns - Retirees typically spend about 55% to 80% of their preretirement income once they leave the workforce [4] - Housing dominates retirement budgets, accounting for about one-third of total spending for households headed by someone aged 65 and older, followed by transportation (15%), healthcare (13%), and food (13%) [5] - The average retiree household spends about $60,000 annually, with housing (36%), transportation (15%), healthcare (13%), and food (13%) taking the largest shares of the budget [6] Spending Evolution - Inflation-adjusted spending typically declines by about 26% between the ages of 65 and 84, although long-term care costs remain a significant variable not captured by standard spending data [6] - Financial planner Michael Stein describes retirement spending as evolving through "go-go," "slow-go," and "no-go" years, with increased spending in the 60s for travel and leisure, followed by a decline in spending as energy and mobility decrease [7] - Research indicates that real (inflation-adjusted) spending declines approximately 26% between the ages of 65 and 84 [8]