The 80% retirement rule suggests replacing about 80% of your pre-retirement income to maintain your lifestyle. It’s a starting point, not a one-size-fits-all answer, since work costs drop but healthcare, travel, and home expenses may rise. Tailor the rule to your goals, location, and spending patterns for accuracy
Retirement planning needs a useful anchor, and the 80% rule offers one: aim to replace roughly four-fifths of your working income in retirement. The idea is that commuting, workwear, and convenience spending fall away, while healthcare and leisure can increase—so the rule is a practical estimate, not a rigid target Moneycontrol.
Key highlights
• Notable update: The 80% figure assumes certain work-related costs decline (commutes, office attire, weekday eating out), helping you live well on less than your full salary
• Major takeaway: Expect some expenses to rise—healthcare, home maintenance, and travel—so adjust your replacement rate based on lifestyle and health outlook
• Important point: Build a personalized budget: map fixed costs, discretionary goals, and inflation to test whether your number is 70%, 80%, or even 90%
• Practical step: Combine pensions, annuities, NPS, and investments to create steady income streams that meet your target, with buffers for surprises
• Smart check: Revisit the estimate every year; retirement spending often shifts in “go-go,” “slow-go,” and “no-go” phases
Sources: Moneycontrol, SmartAsset