Every individual hopes to have a wealthy retirement life, but achieving this goal typically requires decades of financial planning, savvy investments, and maintaining a disciplined savings lifestyle. When a retiree reaches the age of 75 with $5 million in assets, where would they spend their money?
Retirement expenses vary based on personal preferences and location, but affluent retirees typically prioritize comfort, health, travel, and estate planning. Below is a typical monthly budget for wealthy retirees as compiled by Gobankingrate.
Even in retirement, housing remains a major expense. Wealthy retirees may reside in upscale retirement communities, own private residences, or have multiple properties.
According to SeniorSite data, in the United States, monthly fees for Continuing Care Retirement Communities (CCRCs) or luxury rental housing range from $4,150 to $22,000, depending on location and level of care.
Other housing-related costs may include:
– Property taxes
– Maintenance and landscaping costs
– Home insurance
– Homeowner association (HOA) fees
– Utility bills and security services
Some wealthy individuals may even hire household managers or property managers.
At the age of 75, healthcare is, of course, a top consideration. Wealthy retirees often need to pay high fees to enjoy comprehensive Medicare coverage: Part B around $185 per month, Medicare Advantage (Part C) around $11 per month, Part D $46.50 per month, and Medigap roughly $150, totaling about $800 per month for a couple. High-income earners may also have to pay additional Income-Related Monthly Adjustment Amounts (IRMAA) fees.
Additional monthly healthcare expenses may include:
– Supplemental insurance premiums
– Prescription drugs
– Private nursing or care services
– Physical therapy or wellness programs
Wealthy retirees typically enjoy international travel, cruises, or purchasing a second home abroad. Without the pressure of full-time work, travel may shift from an occasional luxury to a significant part of their lifestyle.
A wealthy retiree’s monthly travel budget may include:
– Airfare (first class or business class)
– Luxury accommodations
– Dining and entertainment
– Short trips or private excursions
– Memberships in clubs (golf, yachting, social clubs)
Fine dining, theaters, concerts, and entertaining guests are common pleasures. Many affluent retirees frequently dine at high-end restaurants and may allocate generous budgets for:
– Wine and gourmet dining
– Cultural activities or events
– Private chefs or catering services
– Hosting guests at home
Many retirees use their wealth to help their grandchildren or contribute to charity. Monthly expenses may include:
– Contributions to 529 plans for grandchildren (education savings plans)
– Gifts to heirs or trusts
– Donations to charitable organizations or foundations
These expenses may cover luxury car rentals, drivers, or private transportation services. Some individuals may even own a small plane or yacht, which, if not included in leisure expenses, would add a significant cost.
Other expenses may include:
– Personal grooming, massages, or spa services
– Estate planning and legal services
– Tax advisors or financial planners
– High-end shopping and gifts
The above monthly budget reflects the luxurious and meticulously planned retirement lifestyle of wealthy seniors. For high-net-worth individuals aged 75 and above, the financial focus has shifted from accumulation to enjoyment, care, and legacy. Whether it’s a private residence in a top-tier retirement community, first-class travel, or intergenerational gifts, each expense holds exceptional significance.
Consumption in this stage of life is not merely for necessity but for enhancing quality of life, maintaining independence, supporting family and friends, and contributing to charitable causes.