You will need more money when you’re retired than you think

Many people claim that you will need a fraction of what you earn now to live a comfortable life when you’re old. It is said that 70% of your income as an adult professional should be enough. It turns out it is not true.

The consensus that you’ll need 70% or 80% of your final income in retirement is way off. For many people, it’s around 130%. https://t.co/SNzSZVDoay via @WSJ

— Dan Ariely (@danariely) 4 września 2018

Dan Ariely is a behavioral economics guru. In the article, he published in the Wall Street Journal he argues that you’ll need much more money since it’s going to be like a weekend every day. And you spend more on weekends.

When we retire, it is as if someone took 10 waking hours of our workday and gave us free time to do as we please. Every day becomes just like the weekend. And on the weekend, we have all kinds of time and opportunities to spend money. We shop, travel, buy tickets for events and eat out.

Think about it. You will spend more and live longer. It means you should do everything you can, even take a substantial financial risk, to earn the money you’ll need.