Retirement Spending Advice Highlights Three Life Phases

Financial advisers warn that early retirement decisions can quickly erode savings. Claiming Social Security before age 70 can reduce benefits by up to 30% for life, while Medicare leaves out significant expenses such as hearing aids, dental and vision care. Long‑term care costs are also a major risk; an average home health aide costs roughly $78,000 annually and a semiprivate nursing‑home room averages $111,000, potentially exhausting the median retirement nest egg of $200,000.

A proposed framework divides retirement into three phases. The “go‑go” years (typically in the early 60s) focus on active spending for travel, hobbies and family experiences. The “slow‑go” years (70s) shift toward health‑related expenses and modest travel, requiring adjusted cash‑flow and investment strategies. The “no‑go” years (80+) prioritize safety, dignity, and long‑term care, with budgets reflecting higher insurance and support costs. Planners suggest setting separate budgets for each phase, aligning Social Security, pensions and portfolio withdrawals accordingly, and preparing for care costs early.