It really depends on lifestyle and the things that are important in retirement. For some, it means going on a cruise a couple of times a year. Some will enjoy traveling and exploring European cities. Others will enjoy a fast-paced and active city life, the arts, theatre and music scene, or eating out often. For my wife and I, a life of luxury means spending as much time as possible outdoors: tent camping in secluded places, hiking, kayaking, mountain biking, gardening, road trips. And I hate flying, not surprisingly as I was at one point working for a major airline and we had more than our share of international travel. We rarely if ever eat out, as we have more pleasure preparing our dinner on a Coleman camping stove or camp fire in the middle of the Utah desert than we would eating in a Michelin-rated restaurant in Paris. This means that our actual spending is much lower than most, and indeed is currently well below $22,000 per year, by choice, not by obligation.
We own a mortgage-free condo in Calgary that we will be selling soon so we can build a very small home/workshop on a 4-acre wooded lot we own on one of the Gulf Islands. Home will be off-grid (well, septic, solar). Our total annual housing expenses, including electricity, insurance, taxes, maintenance, are currently $6,000 but will go down to $3,000 once we are on the island. Vehicle insurance, registration, licensing, and maintenance for our gas-guzzler camper van used only for travel, top $2,000 a year. Our total food cost for 2 currently amounts to $6,000 per year but will likely decrease once we move to the island and subtract what we will grow and harvest (clams, salmon, crab, deer. Add another $1,000 for clothing and miscellaneous, and I am at around $12,000 for basic needs. Communication-wise, we do not have internet or cable but use two Mexican cell phones with data plans and no roaming fee in Canada, the USA and Mexico for $10 per month each, enough for our limited needs. Starting last year, we drive to Mexico in the early fall and spend 6 months there, mostly camping. For next year, we are renting a one-bedroom fully-equipped beach studio, a block from the ocean in a little beach town on the Pacific for $500 per month ($3,000), including all utilities and internet. Food and enough beer and licor the cana is much cheaper there than in Canada and is already included in my annual budget. Add another $2,000 for our annual roundtrip, including gas and Mexican auto insurance. Total for year: $17,000. Let’s add another $5,000 for replacing a kayak or a mountain bike once a year, medical travel insurance, and/or a bit of entertainment (not sure what but let’s just have a buffer for the sake of it), and we are at about $22,000. I am sure I am forgetting something but it wouldn’t add much on our budget.