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Predictions for future spending are most accurate when adjusted for your age.

To Age 35

In your spending plan, allow for:

• paying off student loans
• buying a house
• combining incomes with a spouse
• starting a family
• saving for emergencies
• saving for retirement (it is never too soon!)

Age 35 to Age 50

Think about:

• emergency funds
• non-working spouse
• paying off the credit cards
• taking care of aging parents
• college for the kids
• retirement getting closer

Age 50 and Above

Things to consider:

• lifestyle changes in retirement
• increased health care costs
• taking care of aging parents
• smaller house?
• adult children moving back home
• more travel?
• emergency funds (always)
• eating out more?
• paying off mortgages and loans
• no work clothes
• no commuting

More Things to Think About

Be realistic. If you spend $500 a month for food now, you are not going to be able to cut it to $100 next month.

• Do things gradually. Cut your expenses in any given area by 10% or so at a time. See if you can live with it. Then cut a little more.
• Make allowances for inflation. The cost of goods and services goes up a little bit each year. Historically, the amount is between 3% and 5%.
• Expect the unexpected.